Escrow Services for Real Estate Sales in 2026: How to Safely Transfer the Purchase Price

Are youbuying or selling a property? We can prepare both the purchase agreement and the escrow agreement for you, verify the legal status of the property, set up secure terms for the payment of the purchase price, and handle the registration with the Land Registry. This way, you can handle the entire transfer in one place, and all the documents are properly coordinated.

How long does a real estate transfer take?

The transfer of ownership of a property registered in the Land Registry does not take place immediately upon signing the contract. The Land Registry first examines whether the conditions for approving the registration have been met. It generally has 30 days to decide on the application; in more complex cases, up to 60 days. At the same time, however, a 20-day protective period applies—the registration cannot be approved earlier than 20 days after the Land Registry sends notification to the parties whose rights are to be altered or terminated. In practice, the process often takes less than a month; for example, in July 2026, the average time to complete a registration was 22 days.

In any case, however, the buyer is not the owner of the property until the registration is approved.

How does an escrow account work?

What is the purpose of escrow? Primarily, it ensures that neither the buyer nor the seller has to take unnecessary risks during the real estate transaction. The buyer deposits the purchase price into a special escrow account, and the attorney pays it to the seller only after the conditions agreed upon in the contract have been met.

Escrow acts as a secure intermediary between the payment of the purchase price and the transfer of ownership. The seller gains the assurance that the funds are available, and the buyer has the assurance that the funds will not be released prematurely.

The process itself is structured such that the attorney opens a special bank account at a financial institution, into which the buyer deposits the purchase price. This account must be separate from the attorney’s other funds to prevent any confusion with the money of other clients or even with the attorney’s own funds.

Upon signing the purchase agreement, the buyer transfers the purchase price for the property to the account described above. Once the purchase price has been deposited with the attorney and the seller is assured that they will be paid for the property, the attorney files an application to register the ownership rights in the real estate cadastre. The attorney holds the funds in escrow until the ownership right to the property is actually registered in the buyer’s name in the real estate registry.

Once the ownership right has been registered in the buyers’ name, the attorney releases the purchase price to the seller. If the registration of ownership does not take place, the attorney proceeds in accordance with the terms agreed upon in the escrow agreement. For example, the agreement may allow for correcting defects in the application and resubmitting it, or, in the event of a definitive failure of the transaction, provide for the return of the purchase price to the buyer. This is precisely why it is important to define the terms for both payment and refund as precisely as possible in the escrow agreement.

What changed regarding attorney escrow accounts in 2026?

As of January 1, 2026, new rules are in effect designed to increase oversight of funds held in attorney escrow accounts. A special account must be designated as an attorney escrow account, and only one escrow may be maintained in a single account. Furthermore, a lawyer may only dispose of the funds under the terms agreed upon in the contract.

It is also important for the client that the bank sends the depositor and the beneficiary an electronic confirmation of the escrow account and subsequently informs them of any money transfers. The law does not permit a lawyer to make cash deposits into or cash withdrawals from an escrow account. Information regarding the escrow is simultaneously recorded in the Czech Bar Association’s Electronic Escrow Register, and the Bar Association sends clients confirmation of the entry, any changes to it, and the termination of the escrow.

Another significant development in 2026 is the Czech Bar Association’s Guarantee Fund. This fund is intended for cases where a client suffers damages due to criminal conduct by an attorney in connection with an escrow account, typically embezzlement, for example. Compensation can reach up to 2.5 million CZK per escrow; for the purchase price from the sale of real estate that, according to the land registry, is used for residential purposes, compensation can reach up to 5 million CZK.

How much does attorney escrow cost?

The cost of attorney escrow depends on the specific attorney and the scope of services provided. The price may cover only the escrow itself, or it may be part of a comprehensive legal service package for a real estate transfer—such as the preparation or review of the purchase agreement, the escrow agreement, and the application for registration in the land registry. Therefore, it is advisable to verify in advance not only the price of the escrow service itself but also what exactly is included in it.

What are the risks of selling real estate without an escrow service?

The risks of selling real estate without an escrow account stem mainly from the fact that there is a time lag between the signing of the purchase agreement, the payment of the purchase price, and the registration of the new owner in the land registry. If the buyer sends the money directly to the seller before the transfer is completed, the buyer bears the risk that the Land Registry will not record the title. Conversely, if the buyer were to pay only after the title is registered, the risk falls on the seller.

Escrow resolves this problem by holding the funds with an independent third party during the transfer, and the funds can be released only according to predetermined rules.

Types of Purchase Price Escrow

Escrow services are not limited to those provided by attorneys. In fact, there are several types. Among the most common are:

• Purchase Price Escrow with a Lawyer – This type of escrow is provided by lawyers. They must have professional liability insurance; for a self-employed lawyer, the minimum insurance coverage limit in 2026 is 7.5 million CZK. The rules for attorney escrow are strictly defined, and the funds must be deposited in a special attorney escrow account, which is separate from the attorney’s other assets; only one escrow may be held in a single account at any given time. Each escrow is recorded in the Czech Bar Association’s Electronic Escrow Register.

At Dostupný advokát, we charge a fee for escrow services regardless of the amount involved. Our professional liability insurance has a coverage limit of 50,000,000 CZK.

• Notarial Escrow – Like attorneys, notaries are required to have insurance covering their professional activities. The terms are very similar to those for attorney escrow, but notary escrow services are typically more expensive and offer less flexibility to accommodate your specific needs. The fee for escrow is based on the amount deposited according to the notary fee schedule, to which notaries often add an additional 21% VAT.
• Bank Escrow – With banks, you should expect certain limitations, such as the inability to deposit a purchase agreement or an application for registration in the real estate cadastre, which requires a separate agreement with a lawyer or notary. Banks also use standardized contract forms that may not always meet your specific needs. In practice, there are also cases where banks do not allow the purchase price to be deposited without a loan agreement in place.
• Escrow with a real estate agency – Stricter restrictions apply to real estate agencies. A real estate broker may not actively offer to hold funds in escrow for clients. They may do so only upon an explicit written request from the client, with whom they must also enter into a written escrow agreement. They must maintain a separate account for each client, and funds may be received and disbursed only electronically. Typically, a real estate agency arranges escrow for the client with a bank, notary, or attorney.

When transferring real estate, it is not enough to simply set up the escrow correctly. The purchase agreement, the terms for disbursing funds, and the application for registration in the land registry must function as a single, integrated whole. If you want the entire transfer to be under legal supervision, we will prepare or review the necessary contracts, arrange for the purchase price to be held in escrow, and handle all communication with the Land Registry.

The Process of Disbursing the Purchase Price from an Attorney’s Escrow Account

1. The attorney opens a special bank account designated exclusively for attorney escrow purposes, which is separate from the attorney’s other accounts and is established to hold the client’s funds in accordance with legal regulations and ethical standards. The account is secured so that the funds are protected and used only in accordance with the agreed-upon terms.
2. The buyer and seller sign a real estate purchase agreement. This agreement specifies the terms of the sale, including the price, a description of the property, and other relevant details. Alternatively, they may also sign a preliminary agreement —in this case, a reservation agreement—which is a commitment to enter into a purchase agreement in the future under the agreed-upon terms. Subsequently, together with an attorney, they will sign an escrow agreement, which sets forth the terms and conditions for holding the purchase price in a special account, including the circumstances under which the funds will be released.

1. The buyer deposits the purchase price into a special escrow account held by an attorney. The funds remain in this account until all conditions for their release are met (in particular, the registration of title to the property in the buyer’s name).
2. Once the title to the property has been registered in the buyer’s name, the attorney will release the purchase price to the seller; otherwise, the money will be returned to the buyer and the seller retains the property.

Escrow through a lawyer is also highly recommended in the case of the transfer of a cooperative apartment, as this transfer is effective vis-à-vis the housing cooperative only upon delivery of the purchase agreement to the cooperative. Once again, this creates a gap and, consequently, a risk similar to that associated with the registration of ownership in the real estate cadastre.

The Process of Paying the Purchase Price from Escrow

From our legal practice, we know that a transfer can be significantly more complex, for example, when the apartment being sold is still encumbered by the seller’s mortgage and the buyer is simultaneously financing the purchase with their own mortgage loan.

In one such case, it was necessary to structure the cash flow so that the seller’s loan was first repaid from the purchase price and the conditions for removing the original lien were met. Only then could the remaining portion of the purchase price be paid to the seller. At the same time, it was necessary to ensure that the buyer would not lose their money if the transfer of ownership did not proceed as planned.

We therefore drafted an interlinked purchase and escrow agreement, precisely defined the order of individual payments and the conditions for their release, and aligned the entire process with the requirements of the banks and the land registry. As a result, the transfer could take place in stages, and neither party had to rely on the other fulfilling its obligations only after the money had been sent.

Summary

Escrow resolves the fundamental problem of every real estate transaction: the buyer does not want to pay millions of crowns before becoming the owner, while the seller does not want to lose the property without assurance of payment. Therefore, the funds are held by an independent third party during the transfer and are released only after predetermined conditions are met.

Starting in 2026, the attorney escrow system will be supplemented with additional safeguards. Both the bank and the Czech Bar Association will directly inform clients about important steps, and a Guarantee Fund has been established for cases of damage caused by a lawyer’s criminal conduct, as defined by law. However, even these mechanisms cannot replace a well-drafted contract. It is essential, above all, to specify precisely when the funds will be disbursed, how compliance with the conditions will be verified, and what will happen if the transfer becomes complicated.