Escrow vs Client Account: 2025 Clear Comparison

This guide explains the real differences between an escrow account and a client (segregated) account when you pay for property across borders. You will see how each option protects your funds, how fast it works, what it costs, which documents banks ask for, and when to choose one or the other. The language is simple for easy translation.

Prepared by VelesClub Int. together with partner UNIBROKER.

Need clean document copies or certified translations for your deal? Use our Translations. If you want to start the payment process, contact our Global Transactions team.

Quick idea

Both options hold your money safely until a simple, written condition is met. The main difference is who holds the funds and how the release rule is enforced.

• Escrow: a neutral holder (escrow agent or notary) releases money only when a strict condition is proven.
• Client (segregated) account: a licensed professional holds funds under a short written mandate that says who signs and what proofs are checked.

Side-by-side comparison

Use this table for a fast overview. It shows what matters in real deals.

What is an escrow account (plain words)

Escrow is a protected account where money stays until a clear condition is met. The condition must fit in one short line, for example: “release when the registrar issues title in Buyer’s name” or “release at notarized handover”. The escrow holder is neutral and follows the rule. This makes escrow strong for staged projects and developer deals.

What is a client (segregated) account

A client account holds your money separate from the company’s money. A licensed professional (a notary office, a law firm, or a regulated agent) manages it under a short mandate. The mandate names who instructs release, which documents must be checked, and what to do if a party is silent. This path is often faster for simple private sales.

When to choose each option

Choose escrow when the deal has stages, when a developer is involved, or when you want neutral control and strict checks. Some countries require escrow for certain projects.

Choose a client account for a simple one-time completion with a verified seller, a clear handover act, and a short mandate. Make sure the mandate has a fallback (e.g., release after N days if a party does not reply).

Fees, speed, and FX (what to expect)

Fees. Expect bank transfer fees, possible correspondent fees, and either escrow fees or account-holder fees. The SPA should say who pays what.

Speed. Client accounts are often faster (T+1–T+3). Escrow can take T+1–T+5, because the holder must check the condition before release.

FX. If the price is in a local currency and you hold USD/EUR, compare two paths: convert before sending or convert at destination. Ask for written spreads and total cost; pick the cheaper path after fees.

Documents both options will ask for

Deal papers: Sale and Purchase Agreement (SPA) or reservation, invoice or schedule, and clear beneficiary details.

Your papers: Passport, proof of address, and source of funds (salary, savings, asset sale, investment income).

Extra items: Tax number if needed; power of attorney if you sign remotely; and either an escrow letter or a mandate letter written in simple words. For sworn translations and layout fixes, use our Translations.

How to choose in practice (step-by-step)

Step 1 — Look at the deal shape. Off-plan or staged? Choose escrow. Simple private sale? A client account may be faster.

Step 2 — Write the release rule. Keep it to one clear sentence. For escrow: “release on registrar certificate”. For client account: “release after both parties sign a handover act, and the holder verifies it”.

Step 3 — Define sign-offs and fallback. Say who instructs release and how proofs are verified. Add a fallback if one party is silent for N days.

Step 4 — Prepare KYC/SoF early. Most holds come from missing pages. Prepare everything before you send money.

Step 5 — Align timing and cut-offs. Ask for bank cut-off times and correspondent routing. Add a 2–3 day buffer for checks.

Examples

Example A — Off-plan with stages. Buyer pays a 10% reservation, then milestone payments. Escrow holds funds and releases per milestone certificates. This keeps the developer and buyer aligned and reduces dispute risk.

Example B — Private sale (completed home). Buyer pays into a client account held by a notary office. The mandate says: release after notarized handover and registrar receipt. The office verifies documents and releases funds quickly.

Common mistakes (with simple fixes)

Vague condition wording. Fix: write one short line. Long conditions cause long delays.

Mandate gaps in client accounts. Fix: name who signs, which proofs to check, and what to do if a party is silent.

Mismatched data across papers. Fix: copy names and numbers from the SPA into every form and message.

Late KYC/SoF. Fix: send KYC and source of funds with the payment request, not after a hold appears.

Mini glossary

Escrow: a protected account that holds money until a condition is met.

Client (segregated) account: a special account that holds client funds separate from company funds under a mandate.

Mandate letter: a short document that says who instructs the holder, which documents to check, and when to release funds.

Release condition: a clear trigger, such as “registrar issues title” or “signed handover act”.

Expert comment

“If your release rule fits into one short line, the payment is usually fast. If it needs a paragraph, expect days of back-and-forth.”
— Diego, Risk & Compliance Lead

FAQ

Which is safer: escrow or a client account? Both protect funds. Escrow is stricter and best for staged deals. A client account is strong when the mandate is clear and the sale is simple.

Which is faster? Client accounts are often faster (T+1–T+3). Escrow can be T+1–T+5 because the holder must check the condition.

Do I still need SWIFT MT103? Yes. Share the confirmation to match the reference and track the transfer.

What documents should I prepare? SPA or reservation, invoice or schedule, ID/KYC, source of funds, and an escrow letter or a mandate letter where applicable. Translate or legalize documents if required.

Next steps

Pick the option that fits your deal. If the deal has stages, choose escrow. If it is a simple private sale, a client account with a clear mandate can be faster. Prepare KYC and source of funds early, and agree on one short release rule in writing.

VelesClub Int., together with partner UNIBROKER, coordinates compliant payments and documentation end-to-end to protect your funds and your title.

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