When buying or selling a home, you're likely to encounter a legal term called an escrow account—sometimes called a trust account. These accounts are a crucial part of many financial transactions, especially in real estate, but they're also a place where things can go wrong if someone isn't trustworthy. What Is an Escrow Account? Think of an escrow account as a secure holding place for money that belongs to someone else. In a real estate deal, for example, a buyer's down payment is often put into an attorney's escrow account. The attorney, acting as a neutral third party, holds the money for both the buyer and the seller until all the conditions of the sale are met. The attorney is legally and ethically bound to keep this money separate from their own business or personal funds. This is known as the rule of "no commingling." The entire purpose of an escrow account is to protect the client's money. The funds should never be used by the attorn...