Let's talk about "escrow". To close the sale of a place, a neutral, third party (the escrow holder) is brought into the picture to assure the process will close perfectly and on time. Escrow holders hold money for "safe-keeping" in transactions between a buyer and seller. PayPal is a simple way to think of an escrow company.
Clearing the final hurdles like obtaining funds, signing forms, securing the documents for loans and liens, and making sure you get a clear title to the property in preparation of your purchase gets finalized are all parts of closing in which an escrow agent is useful.
Escrow holders want to obtain the following documents:
- 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 finished in escrow process. At this time, all payments and dues for inspections, title insurance and real estate commissions are paid out. Title to the house is then transferred to you as buyer and appropriate title insurance is issued as noted in the escrow policy.
The escrow agent receives a payment when the closing is complete. I'll keep you informed on what comes next.