First, a little about "escrow". An escrow holder is brought on to assure your property closes on time and the closing process goes smoothly. A home is said to be in escrow when in the closing process, payment is held by a third party on behalf of a buyer and a seller when the exchange of money takes place. An everyday way to understand the concept of what an escrow company does is to think of the use of PayPal for Internet purchases.
The escrow agent makes sure that the terms and conditions of the agreement between the seller and buyer are performed in preparation of the sale being finished.
Escrow companies want to acquire the following forms:
- Fire and other insurance policies
- 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
Upon completion of all instructions of the escrow, closing can take place. At this time, all payments and fees for inspections, title insurance and real estate commissions are taken. The house's title is given to you and title insurance begins per the steps of your particular escrow process.
When closing is finished, you'll submit a payment to the escrow holder. You'll know when it's time to submit the form of payment.