Let's talk about "escrow". An escrow company is hired to assure your property closes on time and the process goes smoothly. Escrow companies hold money for "safe-keeping" in an exchange between a buyer and seller. An everyday way to understand the concept of what an escrow company does is to think of the use of PayPal for online purchases.
The escrow company insures that all terms and conditions of the seller's and buyer's agreement are met prior to the sale being completed. This includes getting funds and certificates, finishing required forms, and seeking out the release documents for any loans or liens that have been paid off with the transaction, assuring you have a clear title to your house before the agreed upon price is fully paid.
These are the legal forms that escrow holders usually compile:
- 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
- Loan documents
- Tax statements
You're ready to close when all parts are finished in escrow process. All expenses like title insurance, inspections and real estate commissions are paid. Title to the house is then transferred to you as now current homeowner and appropriate title insurance is issued as outlined in the escrow instructions.
At the close of escrow, in an acceptable form to the escrow. I'll keep you updated on what comes next.