The Escrow Process / by ame_admin
What is Escrow?
When opening an escrow, the buyer and seller establish terms and conditions for the transfer of ownership of that property. These terms and conditions are given to a neutral third party known as the escrow holder. The Escrow officer, in turn has the responsibility of seeing that these terms of the escrow are carried out.
The escrow is an independent third party — the vehicle by which the interest of all parties to the transaction are protected.
How does the Escrow Process Work?
The Escrow Officer takes instructions based on the terms of your Purchase Agreement and the lender’s requirements. The Escrow Officer can hold inspection reports and bills for work performed as required by the Purchase Agreement. Other elements of the escrow include hazard and title insurance, and the grant deed from the seller to you.
Escrow cannot be completed until these items have been satisfied and all parties have signed escrow documents.
What Does The Escrow Holder Do?
The Escrow Holder is a neutral third party, such as the Escrow Provider, that maintains the escrow and impartially oversees the escrow process, ensuring that all conditions of the sale are properly met.
The Escrow Holder’s Duties Include:
•Serve as the neutral agent and the liaison between all parties involved.
•Prepare the escrow instructions.
•Request a Preliminary Title Search to determine the status of title to the property.
•Comply with the lender’s requirements as specified on its instructions to escrow.
•Receive and handle purchase funds from the buyer.
•Prepare or secure the deed and documents related to the escrow.
•Prorate taxes, interest, insurance and rents.
•Secure releases of all contingencies or other conditions imposed on the escrow.
•Record the deed and any other documents.
•Request the title insurance policy.
•Close the escrow pursuant to instructions supplied by the seller, buyer, and lender, if any.
•Disburse funds as authorized by the instructions, including charges for title insurance, recording fees, real estate commissions and loan payoffs.
•Prepare final statements for all parties involved that account for the disposition of all funds held in the escrow account.