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The House is Almost Yours
Let's talk about "escrow". When you're closing on your new house, an escrow agent is used to make certain the process will close properly and on time.
A house is said to be in escrow when in the closing transaction, funds is secured by a third party on behalf of two parties (in this case, a buyer and a seller) when the exchange of money takes place.
PayPal is a simple way to think of an escrow company.
The escrow holder makes sure that the terms and conditions of the agreement between the seller and buyer are completed prior to the sale being finished.
The records the escrow holder may obtain include:
- Requests for payment for various services to be paid out of escrow funds
- Loan documents
- Tax statements
- Fire and other insurance policies
- Title insurance policies
- Terms of sale and any seller-assisted financing
You're ready to close when all steps are complete in escrow process.
At this time, all payments and dues for inspections, title insurance and real estate commissions are taken.
Title to the property is then given to you as new owner and appropriate title insurance is issued as noted in the escrow instructions.
At the close of escrow, in an acceptable form to the escrow.
I'll keep you up-to-date on what comes next.
The Escrow Holder Will:
The Escrow Holder Won't:
- Write escrow guidelines
- Perform a title search
- Comply with the bank's guidelines as outlined in the escrow agreement
- Intake funds from the buyer
- Prorate interest, insurance, tax and other payments according to guidelines
- Record deeds and other paperwork as instructed
- Obtain title insurance policy
- Close escrow when all terms of agreement of seller and buyer are complete
- Disburse payments and finish instructions
- Offer advice - the escrow company must maintain a neutral, third-party status
- Dispense opinions about future tax estimations
Mortgage Escrow Account
A Mortgage Escrow Account is used to pay rolling fees while there is a loan on the house.
Though most home buyers make payments via their monthly mortgage payment, Escrow Accounts are deposited into at closing as well.
Now you know more about how to close on your future home. And, you can be a smarter home buyer and future homeowner.