"Advisor Legacy saw our transaction all the way through."


Let us make it simple for you.

"Advisor Legacy saw our transaction all the way through."


Let us make it simple for you.

Loan Escrow Service

If your purchase agreement spans multiple payment periods and has conditions, you can benefit from our escrow service.

Learn About Escrow Services

An escrow is a financial arrangement where a third party holds and regulates payment of the funds required for two parties involved in a given transaction. It helps make transactions more secure by keeping the payment in a secure escrow account which is only released when all of the terms of an agreement are met as overseen by the escrow company.

Escrows are very useful in the case of a transaction where a large amount of money is involved and a certain number of obligations need to be fulfilled before a payment is released. For example, the sale of a financial advisory practice often contains an attrition clause which requires certain metrics to be met before a portion of the purchase price is paid to the Seller.

The funds necessary to pay the Seller are held in the Escrow Account and released upon the agreed upon transfer date. The Seller, upon the sale of the financial advisory practice, will know that the funds are available rather than wondering if the buyer has the funds.

How Does Escrow Work

Using professionals who understand financial advisory practice transactions reduces the risk of fraud or non-payment by acting as a trusted third-party that collects, holds and only disburses funds when both the buyer and seller are satisfied. Our partner law firm, Kotz Sangster Wysocki, P.C., has extensive experience in the financial services industry and will act as the escrow agent. Here is how it generally works when the buyer is using bank financing (most common method) to purchase the practice:

  • All parties agree to the terms of the transaction.
  • The buyer or seller initiates the escrow account (for SBA loans, the seller must initiate the escrow account).
  • The buyer (or bank) submits payment to the escrow agent by an approved payment method which is typically a wire transfer.
  • Escrow agent verifies the payment is in good order.
  • The seller is notified by the escrow agent that funds have been secured 'In Escrow'.
  • The seller transfers ownership of the financial advisory practice to the buyer.
  • Escrow agent releases the agreed upon funds (generally the down payment) to the seller from the escrow account. Timing of the release will depend upon the availability of the funds.
  • The remaining funds are released to the seller subject to the terms of the escrow agreement.
  • If there is a conflict on how much and timing of the release of funds, the escrow agent will deliver the funds to the agreed upon court which has jurisdiction as agreed upon by the buyer and seller in the escrow agreement.
Escrow Partner

Our partner law firm, Kotz Sangster Wysocki, P.C., has extensive experience in the financial services industry and serves as the escrow agent for our clients.

Kotz-Sangster is a business law firm concentrating on the representation of middle market companies and their business interests. Their team is highly skilled in succession planning and businesses ownership transition.

If you would like to learn more about legals services, please contact our attorney partners.

Get Started Today

Complete our Quick Practice Value Estimator and begin taking action to plan your future.

Cost of Service

The cost of an escrow account and the services provided by the escrow agent is $2,500 plus a percentage of the amount deposited, which is paid for by the seller upon execution of the escrow agreement. The funds are held in the escrow agent’s IOLTA account with no interest being paid to either the buyer or seller.

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Advisor Legacy is a full service Mergers & Acquisition consulting firm for financial advisors.

 Location: Troy, MI

 Email : info@advisorlegacy.com

 Phone : 248.328.4100


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