Don't let the unknown prevent you from becoming a homeowner. I can help you understand the process. E-mail me at karl@multizonerealty.com .

What is Escrow?

 Multi Zone Realty, Inc. can walk you through closing - (818)784-7002
Escrow: To complete the sale of a house, a neutral, third party (the escrow holder) is brought into the picture to assure the process will close appropriately and on time. When funds are held by a third party in a transaction between a buyer and a seller, it's in escrow. For example, in an Internet auction, PayPal is the neutral third party that holds the buyer's payment, and then sends the funds to the seller.

Clearing the final hurdles like obtaining funds, completing forms, obtaining the documents for loans and liens, and assuring you get a spotless title to the home before your purchase gets finalized are all parts of closing in which an escrow holder is useful.

The documents the escrow agent may obtain include:

  • 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

Closing on the home takes place when the steps of the escrow are finished. At this time, all payments and dues for inspections, title insurance and real estate commissions are taken. You'll then obtain the title to the home and the title insurance gets issued as noted in the escrow instructions.

The escrow company receives a payment when the closing is complete. As your REALTOR, I'll inform you of the acceptable form of payment.

The Escrow Holder Will:

  • Assemble escrow guidelines
  • Perform a title research
  • Comply with lender's standards as written in the escrow agreement
  • Intake funds from the buyer
  • Prorate insurance, tax, interest and other payments according to instructions
  • Record deeds and other legal documents as instructed
  • Request title insurance policy
  • Close escrow when all terms of agreement of seller and buyer are complete
  • Disburse monies and finalize instructions

The Escrow Holder Will Not:

  • Give advice - the escrow company stays at an impartial, third-party status
  • Dispense opinions about the outcome of your taxes
The Escrow Holder Will:
The Escrow Holder Won't:
  • Write escrow instructions
  • Petition title search
  • Meet lender's standards as outlined in the escrow agreement
  • Accept payments from the buyer
  • Prorate tax, interest, insurance and other fees according to instructions
  • Record deeds and other paperwork as instructed
  • Request title insurance policy
  • Close escrow when all terms of agreement of seller and buyer have been met
  • Disburse monies and finalize instructions
  • Give advice - the escrow company stays at an impartial, third-party status
  • Offer opinions about future tax estimations

Mortgage Escrow Account

A Mortgage Escrow Account is started to make payments for rolling expenses while there is a loan on the house. Escrow Accounts are contributed to monthly by the home buyer (who is now the homeowner), but there is also a lump sum that goes into the account at closing.

Now you know more about being in escrow. And, you can be a more informed home buyer and future homeowner.

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