1.4.9 Escrow Agents
If all of the monies from the loan proceeds are not distributed at the loan closing, the closing agent is usually responsible for holding the remainder until certain events occur. If a home improvement loan is involved, it is common for the remaining proceeds to be paid to a home improvement contractor once work is completed. The lender or escrow agent may have drafted an escrow agreement that governs to whom and when the remaining funds will be paid. This type of escrow agent should be distinguished from the role played by loan servicers in managing borrowers’ escrow accounts.