First, a little about "escrow". To close the sale of a home, a neutral, third party (the escrow holder) is employed to assure the transaction will close perfectly and on time. A place is said to be in escrow when in the closing process, money is secured by a third party on behalf of two parties (in this case, a buyer and a seller) when the exchange of money takes place. For example, in a Web auction, PayPal is the neutral third party that obtains the buyer's funds, and then hands over the funds to the seller.
The escrow company makes sure that the terms and conditions of the agreement between the two parties are performed prior to the sale being completed.
Escrow companies look for the following records:
- Title insurance policies
- Terms of sale and any seller-assisted financing
- Requests for payment for various services to be paid out of escrow funds
- Loan documents
- Tax statements
- Fire and other insurance policies
You're ready to close when every step is complete in escrow process. At this time, all payments and dues for inspections, title insurance and real estate commissions are paid out. You'll then get the title to the house and the title insurance gets issued as outlined in the escrow instructions.
At the close of escrow, payments of funds are made in an acceptable form to the escrow. As your real estate agent, I'll inform you of the acceptable form of payment.