Editing Paymaster (section)

==Purpose==
The primary purpose of a paymaster is to receive fees in [[escrow]] by buyers in a large transaction, and disburse to the sellers and brokers on the transaction.

A paymaster is usually, but not required to be, a [[lawyer]] (also known as a 'lawyer paymaster'). When dealing with commission payments on [[contract]]s dealing with large amounts of money (such as oil, gas, steel, iron, gold, [[Medium Term Note|MTNs]], VGs, t-strips, and other instruments), most banks in the United States are very wary of handling such large amounts of money. In addition, most buyers and sellers of such transactions want to place the money with a neutral third party for disbursement. In most cases, the buyer and the seller involved in the transaction require a paymaster be named to handle all incoming and outgoing funds.

A paymaster is a neutral third party and has no knowledge of any particulars of the transaction. They handle the incoming commissions, and then disburses the funds accordingly. In return for their services the paymaster charges a small fee, which is paid directly to them out of the commission proceeds prior to disbursement.