Escrow 101

Escrow
To complete the sale of a property, a neutral, third party (the escrow company) is employed to assure the process will close properly and on time. When funds are held by a third party in a transaction between a buyer and a seller, it's in escrow. An everyday way to understand what an escrow company does is to think of how you might use PayPal for Internet purchases.

Tying up any loose ends like taking in funds, finishing forms, obtaining the documents for loans and liens, and assuring you a spotless title to the property prior to your purchase gets finalized are all parts of closing in which an escrow holder is useful.

	Don't let the unknown prevent you from becoming a homeowner. We can help you become knowledgeable about the process. E-mail us at Steve@stevelindburg.com to get some free information.

These are the documents that escrow agents usually look for: Requests for payment for various services to be paid out of escrow funds Loan documents Tax statements Fire and other insurance policies Title insurance policies Terms of sale and any seller-assisted financing

Upon completion of all instructions of the escrow, closing can take place. All debts and fees are taken and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). Title to the home is then given to you as new homeowner and appropriate title insurance is issued as outlined in the escrow instructions.

At the close of escrow, payment of funds shall be made in an acceptable form to the escrow. As your agent, I'll inform you of the acceptable way of paying.

The Escrow Holder Will:		The Escrow Holder Won't:
Prepare escrow guidelines Request title search Comply with lender's standards as outlined in the escrow agreement Intake payments from the buyer Prorate tax, interest, insurance and other fees according to instructions Record deeds and other documents as instructed Obtain title insurance policy Close escrow when all instructions of seller and buyer have been met Disburse monies and finalize instructions		Give advice - the escrow holder must maintain a neutral, third-party status Give insight about tax implications

Mortgage Escrow Account

A Mortgage Escrow Account is established to pay rolling expenses while there is a loan on the house. Though most home buyers make payments via their monthly mortgage payment, Escrow Accounts are deposited into at closing as well.

This is a easy to understand guide about the escrow process. Your particular methods might be different depending on your bank and your escrow agent.