Let’s talk about “escrow”. To finish the sale of a house, a neutral, third party (the escrow agent) is employed to assure the transaction will close perfectly and on time. A place is said to be in escrow when in the closing transaction, funds is secured by a third party on behalf of two parties when the exchange of money takes place. PayPal is a good example of an escrow company.
The escrow company makes sure that the terms and conditions of the agreement between the sellers and the buyers are reached prior to the sale being finished.
The documents the escrow holder may obtain include:
- Loan documents
- Tax statements
- Fire and other insurance policies
- Title insurance policies
- Terms of sale and any seller-assisted financing
- Requests for payment for various services to be paid out of escrow funds
Closing on the home takes place when the steps of the escrow are done. All expenses like title insurance, inspections and real estate commissions are paid. The property’s title gets transferred to you and title insurance is issued per the policies of your individual escrow process.
The escrow agent receives a payment at the completion of closing. I’ll keep you updated on what comes next.
- Assemble escrow instructions
- Request title inquiry
- Comply with lender’s requirements as noted in the escrow agreement
- Intake payments from the buyer
- Prorate interest, insurance, tax and other payments according to guidelines
- Record deeds and other legal documents as instructed
- Request title insurance policy
- Close escrow when all terms of agreement of seller and buyer are complete
- Disburse monies and finalize instructions
- Advise you – the escrow company has to remain an impartial, third-party status
- Dispense opinions about the outcome of your taxes