What is Escrow? Copy

What is "Escrow"?

 

Elderly woman reviewing documents

To finalize the sale of the home a neutral, third party (the escrow holder, a.k.a. escrow agent) is engaged to assure the transaction will close properly and on time. The escrow holder insures that all terms and conditions of the seller's and buyer's agreement are met prior to the sale being finalized, including receiving funds and documents, completing required forms, and obtaining the release documents for any loans or liens that have been paid off with the transaction, assuring you clear title to your property before the purchase price is fully paid.

The documentation the escrow holder may be collecting includes:

  • Loan documents
  • Tax statements
  • 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

 

Upon completion of all instructions of the escrow, closing can take place. All outstanding payments and fees are collected and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). Title to the property is then transferred to the seller 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. 

 

The Escrow Holder Will:                                                           The Escrow Holder Won't:

- Prepare escrow instructions                                                                                                                       - Offer opinions about tax implications
- Request title search                                                                                                                                    - Give advice - the escrow holder must maintain a neutral, third-party status
- Comply with lender's requirements as specified in the escrow agreement
- Receive funds from the buyer
- Prorate insurance, tax, interest and other payments according to instructions
- Record deeds and other documents as instructed
- Request title insurance policy
- Close escrow when all instructions of seller and buyer have been met
- Disburse funds and finalize instructions
 
 
 
 
 

Cornerstone Mortgage

5940 S. Rainbow Blvd., Suite 201
Las Vegas, NV  89118
(702) 840-3500 
NMLS ID 340311
NV: License: 4814
CA: Licensed by the Department of Business Oversight, under the CA Residential Mortgage Lending Act.  CA Finance Lender #60DBO86761. California Department of Real Estate 01848420.

1500 Standiford Ave., Suite A1 
Modesto, CA  95350
(209) 578-9000
NMLS ID: 1741490   |   CalDRE License: 01848420

200 Tampa St. 
Turlock, CA  95382
(209) 633-3222
NMLS ID: 1739798   |   CalDRE License: 01848420

91-110 Hanua St., Suite 201 
Kapolei, HI  96707
(808) 784-1239
NMLS ID: 1669660