First, a little about "escrow". An escrow company is hired to assure your home closes on time and the money exchanging part of closing goes smoothly. When funds are held by a third party in a transaction between a buyer and a seller, it's in escrow. PayPal is a good way to picture an escrow company.
The escrow holder makes sure that all terms and conditions of the seller's and buyer's contract are reached prior to the sale being finished. This includes securing payments and records, completing required forms, and getting the release documents for any loans or liens that have been cleared with the transaction, assuring you have a clear title to your house before the negotiated price is fully paid.
Escrow holders look for 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 every step is finished in escrow process. All debts and fees are collected and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). Title to the property is then given to you as new homeowner and correct title insurance is issued as outlined in the escrow instructions.
At the close of escrow, payments of funds are made in an acceptable form to the escrow. I'll keep you updated on what comes next.