Cows in Escrow – Business for Sale

April 8, 2010

In a (real estate/business) sales class, the example of cows for escrow came up.  The lecturer used cows as an example of possible escrow.  It was a true story.  This is New Mexico after all.

In fact a number of things can be escrowed.  In the example being used in class, the cows’ owner wanted to buy something and had to put up escrow.  He did not want to sell the cows unless the sale was to be finalized.  The Seller, needing escrow to confirm intent of the owner, to figure out whether the value stated was sufficient (after all a cow could die while in escrow;) to be comfortable that the cows would be safe in the pasture; and, would he be able to sell the cows in the case of escrow forfeiture.

Cows are not the norm but it does give perspective to the fact that not every escrow company can or will do everything.   In business-for-sale transactions the needs for escrow are perhaps not fulfilled by the typical escrow company for a house for sale.

Before you get too fancy in defining the terms of your purchase, ensure escrow management is available.

For a more in depth explanation of when escrow can be used:

http://www.bizben.com/blog/posts/using-escrow-services-040809.php

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