How Do I Open An Escrow?

Generally, the Buyer's Real Estate Agent will open the escrow. As soon as you execute the purchase agreement, the Selling Agent will place the Buyer's initial deposit, if any, into the escrow account or into the Real Estate Broker's trust account.

Who chooses the escrow agent?

The buyer, seller, and lender will choose the escrow agent together. Often, the agent is chosen at the recommendation of a real estate broker. However, there is no obligation to follow a broker’s advice. Escrow companies are independent. In order to avoid any possibility of partiality, they do not receive referral fees from brokers.

Who pays the escrow fees?

Many of the activities involved in closing escrow have fees associated with them. Examples include document transfer tax, recording of the grant deed, title insurance, inspection fees, notary fees, etc. These types of fees may be paid by either the seller or the buyer (or even the lender in some circumstances) depending on the traditions and practices in the local area and on the preferences of the involved parties. Typically, the buyer and the seller will split the escrow company’s fees fifty-fifty, or each pay their own fees.

What Information Will I Need To Provide?

You will be asked to complete a Statement of Identity (SI) as part of the necessary paper work. Because many people have the same name, the SI is used to correctly identify the specific person in the transaction through such information as date of birth, social security number, previous addresses, etc. This information is kept confidential and is required to provide title insurance.

What Do I Need To Do Before My Appointment To Sign Escrow Papers?

All parties signing the documents must bring proper identification: Either a valid driver's license, identification card, or current passport. This is needed to verify your identity by the notary public. It is a routine, but necessary step, for your protection.

When and Where Do I Sign Escrow Instructions?

Your Escrow Officer or Real Estate Agent will contact you to make the appointment for you to sign your escrow instructions, Grand Deed, and final papers. At this time, the Escrow Officer will also tell you the approximate amount of proceeds you will receive for the sale of your home.

What's The Next Step After I've Signed The Closing Escrow Papers?

After both parties have signed all the necessary instructions and documents, the Escrow Officer will return the Buyer's loan documents to the Lender for a final review. This review usually occurs within a few days of execution of the documents. After the review is completed, the Lender is ready to fund the Buyer's loan and inform the Escrow Officer.

How Long Is An Escrow?

The length of an escrow is determined by the terms of the purchase agreement and can range from a few days to several months. An escrow often averages 30 to 45 days.

What Is An "Escrow Closing"?

An escrow closing is the culmination of the transaction. It signifies legal transfer of title from the Seller to the Buyer.

Generally the Grant Deed and Deed of Trust are recorded within one working day of the escrow holder's receipt of loan funds. This completes the transaction and signifies the "close of escrow". Once all the conditions of the escrow have been satisfied, the Escrow Officer informs you or your Agent of the date escrow will close and takes care of the technical and financial details.

Do I Continue To Pay My Monthly Mortgage Payment?

Yes, your mortgage payment(s) must be kept current throughout the course of the escrow transaction. If the payments are not kept current, the Lender(s) can/will assess and collect late charge(s).

When Are My Existing Loans Paid Off?

Unless the Buyer takes over your existing loan(s) on the property, the loan(s) will be paid off at the close of escrow. You will need to furnish complete information to your Escrow Officer and Real Estate Agent on each loan against your property. Please be prepared to provide the name of each Lender. Your Escrow Officer will need this information to order the loan payoff demands so the loan(s) may be paid off correctly at the close of escrow. Homeowners Association information may also be required if you are selling a condominium, townhouse or property located in a planned unit development. All of this information will help to ensure the timely closing of your escrow.

What Are Disclosures And Contingencies?

During the process of selling your property, you will be asked to fill out a property dis­closure form, which is now required by law. In this document you will inform the Buyer of any significant facts you have about the conditions of the property. If you are moving to California, other disclosures may be necessary. Your Real Estate Agent or Escrow Officer will assist you with these.

There will be various contingency dates in your real estate sales contract. You should be very aware of these and be sure that the actions required are performed in a timely manner. Such contingencies include the Buyer's loan approval, approval of Preliminary Title Report, approval of structural pest control and other inspections. Stay closely in touch with your Real Estate Agent regarding these important dates.

When And Where Do I Get My Final Proceeds Check?

The proceeds check is disbursed upon close of escrow, when the Escrow officer is able to verify with the County Records Office that the documents have recorded and legal transfer has occurred. The proceeds check is usually delivered to your Real Estate Agent.

What Happens To Funds Held In Escrow?

In some cases the escrow company will be instructed to hold funds in escrow to pay-off obligations, which may not have been completed yet, even after the close of escrow. An example might be to set aside funds to correct a structural problem, remodeling or termite repair work. Upon completion of the project and receipt of the proper documentation and/or releases, the Escrow Officer will disburse the reserved funds to you.