Escrow: When you're closing on your new home, an escrow agent is used to ensure the process will close appropriately and in a specific time frame. When payment is held by a third party in a transaction between a buyer and a seller, it's in escrow. For example, in an online auction, PayPal is the neutral third party that obtains the buyer's money, and then sends the money to the seller.
Settling the last details like obtaining funds, finishing forms, obtaining the documents for loans and liens, and assuring you get a spotless title to the home before your purchase gets finalized are all parts of closing in which an escrow company is useful.
The pieces of paperwork the escrow agent may obtain 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 parts are complete in escrow process. At this time, all payments and fees for inspections, title insurance and real estate commissions are taken. Title to the house is then transferred to you as new owner 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 informed on the procedure.