Be Informed About the Escrow Process

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Let's talk about "escrow". An escrow agent is hired to assure your house closes on time and the transaction goes smoothly. Escrow holders hold money for "safe-keeping" in an exchange between a buyer and seller. PayPal is a good way to picture an escrow company.

Settling the last details like taking in funds, finishing forms, obtaining the documents for loans and liens, and making sure you get a clear title to the house before your purchase gets finalized are all parts of closing in which an escrow agent is useful.

Escrow agents compile the following pieces of paperwork:

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

Closing on the property takes place when the steps of the escrow are complete. At this time, all payments and dues for inspections, title insurance and real estate commissions are taken. Title to the home is then given to you as now current homeowner and appropriate title insurance is issued as outlined in the escrow policy.

At the close of escrow, payment of funds shall be made in an acceptable form to the escrow. As your REALTOR, I'll let you know what is an acceptable form of payment.

The Escrow Holder Will:

Write escrow guidelines
Petition title search
Comply with lender's requirements as written in the escrow agreement
Receive payments from the buyer
Prorate interest, insurance, tax and other payments according to guidelines
Record deeds and other legal documents as instructed
Obtain title insurance policy
Close escrow when all instructions of seller and buyer are met
Disburse payments and finalize instructions

The Escrow Holder Won't:

Tell you what's best - the escrow agent stays a neutral, third-party status
Dispense opinions about future tax estimations

The Escrow Holder Will:		The Escrow Holder Won't:
Assemble escrow instructions Petition title inquiry Comply with the bank's standards as outlined in the escrow agreement Accept payments from the buyer Prorate tax, interest, insurance and other fees according to guidelines Record deeds and other legal documents as instructed Obtain title insurance policy Close escrow when all terms of agreement of seller and buyer have been finished Disburse monies and finalize instructions		Tell you what's best - the escrow agent stays at an impartial, third-party status Dispense opinions about the outcome of your taxes

Mortgage Escrow Account

Creating a Mortgage Escrow Account helps keep track of on-going expenses while there's a loan on your house. Generally, the Escrow Account is partially funded at closing and the home buyer makes on-going contributions through their monthly mortgage payment.

This is a quick run-down of the escrow process. Your particular methods may vary based on your lender and your escrow company.