What is an escrow?
The buyer and seller conduct business with each other through a neutral intermediary, your escrow company. Mutual written instructions by both parties are carried out by the escrow holder to exchange property and funds.
What does an escrow company do?
An Escrow company is a licensed, neutral third party that holds and distributes legal documents and funds on behalf of a buyer and seller in a real estate transaction.
When do I open an escrow?
As soon as you and your other party are in complete agreement, a mutually selected escrow officer should be called. Consider the professional advice of your real estate agent.
What does an escrow officer need from me?
Along with the terms of the sale, the following are a list of items that are most helpful to expedite your transaction.
Seller
1. Recent existing lender statement(s).
2. Current Home Owner Association documents.
3. Recent structural pest control report (if required).
Buyer
1. Complete names & vesting (seek tax advice as to consequences of how you take title).
2. Initial deposit check.
3. Terms of financing and new lenders name .
4. Insurance agent information.
The escrow officer does?
Prepare instructions and specific documents. Order all necessary payoff or assignment statements, homeowner association statements and title search. Secure releases of existing liens of record and disburses documents in accordance with mutual written instructions. Prepare all final statements for principals, accounting as to the disposition of all funds deposited with the escrow officer. Provide you with the assistance to close your transaction quickly and effectively. Escrow officers are trained, experienced professionals.
The escrow officer does not?
Act as a negotiator for the transaction or any terms thereof. Offer legal and or tax advice. Offer investment advice.
Can I get legal legal advice from the escrow officer?
An escrow officer is not a legal counselor and cannot give you advice. Remember, the purpose of escrow is to take, and comply with, instructions to carry out the mutual agreement of the principals. In the event of disagreement of the parties, the escrow officer must remain neutral until agreement is reached. The transaction should not be negotiated in the escrow office, nor should an escrow officer become involved in the negotiation.
What fees must I pay at closing?
Fees and charges are controlled by many factors and depend largely upon the type of transaction and the terms of your agreement. However, there are certain charges which are considered to be normal. These would include fees charged by a lender in connection with obtaining a new loan or in paying off the old one. They may also include recording fees, title insurance policy premium, documentary transfer taxes, prepaid taxes and insurance and escrow fees. Your escrow officer will provide you with an itemized statement.
Your closing funds should be in the form of a wire transfer to the escrow holder in the amount requested. Do not bring a personal check, cashiers check, official check, money order or other form of payment to close a transaction. It will only delay the closing, since the funds must be collected before the closing can take place. An out-of-town check can cause a week to ten days delay in closing.
What is the fee for the escrow service?
The escrow fee is normally based on the size and complexity of the transaction. Since there are so many types of escrows and every transaction is different, refer to the company fee schedule. Usually the escrow fee is divided in accordance with the agreement of the parties.