In some states this is called Escrow.  In North Carolina we close with Attorneys.
To finalize the sale of the home a neutral, third party attorney (in other states the escrow holder, a.k.a. escrow agent) is engaged to assure the transaction will close properly and on time. The attorney insures that all terms and conditions of the seller's and buyer's agreement are met prior to the sale being finalized, including receiving funds and documents, completing required forms, and obtaining the release documents for any loans or liens that have been paid off with the transaction, assuring you clear title to your property before the purchase price is fully paid.

Upon completion of all instructions from the lender, your closing can take place. All outstanding payments and fees are collected and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). Title to the property is then transferred to the seller and appropriate title insurance is issued as outlined in the escrow instructions.
At the closing, payment of funds shall be made in an acceptable form to the attorney. As your loan officer, I'll inform you of the acceptable form.

Mortgage Escrow Account