Purchasing property for the first time can be overwhelming. I can help. E-mail me at krrf@comcast.net to get some free information.
Using an Escrow Agent
Escrow
To finish the sale of a house, a neutral, third party (the escrow agent) is employed to assure the process will close appropriately and on time.
A place is said to be in escrow when in the closing process, money is held by a third party on behalf of two parties when the transaction is taking place.
For example, in an Internet transaction, PayPal is the reliable third party that holds the buyer's payment, and then disburses the funds to the seller.
The escrow holder makes sure that the terms and conditions of the agreement between the two parties are completed in preparation of the sale being finalized.
These are the legal forms that escrow agents usually look to collect:
- Loan documents
- Tax statements
- 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
Upon finishing of all instructions of the escrow, closing can take place. At this time, all payments and dues for inspections, title insurance and real estate commissions are paid out. You'll then obtain the title to the home and the title insurance gets dispersed as stated in the escrow instructions.
When closing is in it's last step, you'll pay the fees to the escrow agent. As your real estate agent, I'll let you know what is an acceptable form of payment.
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The Escrow Holder Will: |
The Escrow Holder Won't: | |
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Mortgage Escrow Account
Often, to pay recurring costs while there's a loan on the house, a Mortgage Escrow Account is created. Usually, the home buyer makes a payment at closing and also makes regular deposits through their monthly mortgage payment to fund the Escrow Account.
Once you're at ease with the escrow process, you can be a better buyer.