An escrow holder ensures that your property transaction closes on time and that the process runs smoothly. Escrow refers to money held by a third party during a transaction between a buyer and a seller. To understand the role of an escrow company, imagine how you might use PayPal for online purchases.
The escrow holder ensures that the terms and conditions agreed upon by the buyer and seller are met before finalizing the sale.
Typically, these are the records that escrow companies compile:
- 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
You are ready to close once every step in the escrow process has been completed. This includes paying all expenses such as title insurance, inspections, and real estate commissions. The property title is then transferred to you, and title insurance commences according to the terms of your escrow agreement.
Upon completion of the closing process, you will make a payment to the escrow company. As your REALTOR®, I will inform you of the acceptable forms of payment.
The Escrow Holder Will: | The Escrow Holder Won’t: | |
|
|
Mortgage Escrow Account
A Mortgage Escrow Account is established to cover recurring fees while there is a loan on the house. Typically, the Escrow Account is partially funded at closing, and the homebuyer makes ongoing contributions through their monthly mortgage payments.
This is a basic outline of the escrow process. Your specific plan may vary depending on your lender and escrow company.