As the principals direct the transaction, the escrow holder is more

Study for the California Escrow Exam. Dive into detailed content with flashcards and multiple choice questions, accompanied by explanations and hints. Ensure your success on test day!

The main idea is that the escrow holder acts as a neutral facilitator who follows the directions of the parties involved in the deal. Because buyers, sellers, and lenders provide the instructions, set the deadlines, and authorize actions like releasing funds or distributing documents, the escrow holder’s role is to respond to those directions and complete tasks accordingly. That makes the escrow holder more reactive than proactive: they act in response to what the principals instruct or what conditions are met, rather than initiating steps on their own. While they do perform duties and manage the process, they do not set the terms or start actions without guidance.