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Escrow

Once a particular condition is met, a deed, bond or other documentation that is put into guardianship of a third party is an escrow. In terms of the EB-5, before the prospective immigrant receives their I-526 application approval, the capital put into the investment is normally held in an escrow account. The funds are removed from the escrow and put towards the commercial enterprise as soon as the application is approved. An escrow agent is the individual or entity with the responsibility of enabling the transfer of property between two parties. The responsibility of freeing the investment funds once the I-526 application for the intending immigrant is approved, in terms of the EB-5 context, belongs to the escrow agent; otherwise if the I-526 is unsuccessful, the investor is reimbursed the funds by the escrow agent. The document that delineates the terms of the escrow between the investor and the targeted business enterprise is known as an escrow agreement. The escrow agreement indicates who the escrow agent is by name, under what circumstances will the funds be released or reimbursed, payments related to the functions, authority in case of legal action, and so on.

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