The Cascade Team Blog

Is there a difference between a Title and Escrow company or are they the same?

Posed Question: When we bought our home last month I heard the terms “title insurance company” and “escrow company” used interchangeably. What is the difference?

The escrow company handles the paperwork relating to the closing of the transaction and acts as an independent third party for disbursement of the transaction funds.  For example, execution of the deed and affidavit of property value, and the funding of the loan from the mortgage lender. The escrow company is licensed and regulated by the Arizona Department of Financial Institutions. The title insurance company is responsible for insuring the title to the home, and will generally the title insurance policies to the buyer and the mortgage lender at the close of the transaction. The title insurance companies in Arizona, issuing these title policies, are licensed and regulated by the Arizona Department of Insurance. The reason the terms are frequently used interchangeably is that the same company, especially if it is a large company, can be both the escrow and the title-insurance company in the transaction.  There are very few companies that do only one of the functions in Arizona.