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What is Escrow?

 Roxanne Mercer Real Estate can walk you through closing - (707) 318-8829
First, a little about "escrow". To finish the sale of a house, a neutral, third party (the escrow holder) is brought into the picture to assure the process will close correctly and on time. A home is said to be in escrow when in the closing transaction, funds is secured by a third party on behalf of a buyer and a seller when the exchange of money takes place. PayPal is a simple way to think of an escrow company.

The escrow agent is careful to assure that all terms and conditions of the seller's and buyer's agreement are met prior to the sale being completed. This includes getting funds and documents, completing required forms, and seeking out the release documents for any loans or liens that were paid with the transaction, assuring you have a clean title to your property before the purchase price is fully paid.

Escrow agents collect 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

Upon finishing of all instructions of the escrow, closing can take place. All outstanding payments and fees are collected and paid off at this time (covering expenses such as title insurance, inspections, real estate commissions). The home's title gets transferred to you and title insurance is issued per the policies of your individual escrow process.

At the close of escrow, payments are submitted in an acceptable form to the escrow. I'll keep you informed on the procedure.

The Escrow Holder Will:

  • Prepare escrow guidelines
  • Request title inquiry
  • Comply with lender's requirements as noted in the escrow agreement
  • Intake payments from the buyer
  • Prorate interest, insurance, tax and other payments according to guidelines
  • Record deeds and other paperwork as instructed
  • Obtain title insurance policy
  • Close escrow when all terms of agreement of seller and buyer have been finished
  • Disburse funds and finish instructions

The Escrow Holder Will Not:

  • Advise you - the escrow agent stays a neutral, third-party status
  • Give insight about tax implications
The Escrow Holder Will:
The Escrow Holder Won't:
  • Assemble escrow instructions
  • Request title research
  • Comply with lender's standards as written in the escrow agreement
  • Accept funds from the buyer
  • Prorate interest, insurance, tax and other payments according to guidelines
  • Record deeds and other legal documents as instructed
  • Obtain title insurance policy
  • Close escrow when all terms of agreement of seller and buyer have been finished
  • Disburse payments and finish instructions
  • Advise you - the escrow holder must stay at a fair, third-party status
  • Offer opinions about the outcome of your taxes

Mortgage Escrow Account

A Mortgage Escrow Account is established to pay rolling expenses while there is a loan on the house. Generally, the Escrow Account is partially funded at closing and the home buyer makes on-going contributions through their monthly mortgage payment.

Once you have the rules of the escrow process down, you can be a confident buyer.

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