Let's talk about "escrow". When you're closing on your new property, an escrow agent is used to assure the transaction will close properly and in a certain amount of time. A house is said to be in escrow when in the closing process, money is held by a third party on behalf of a buyer and a seller when the transaction is taking place. An easy way to understand the concept of what an escrow company does is to think of the use of PayPal for Internet purchases.
The escrow agent is careful to assure that all terms and conditions of the seller's and buyer's agreement are performed prior to the sale being completed. This includes receiving monies and documents, completing required forms, and seeking out the release documents for any loans or liens that have been cleared with the transaction, assuring you have a clean title to your place before the negotiated price is fully paid.
The certificates the escrow holder may collect 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 finished in escrow process. All expenses like title insurance, inspections and real estate commissions are paid. You'll then get the title to the house and the title insurance gets issued as outlined in the escrow instructions.
When closing is finished, you'll make a payment to the escrow holder. As your REALTOR, I'll inform you of the acceptable form of payment.