Don't let the unknown keep you from becoming a homeowner. I can help you become knowledgeable about the process. E-mail me at bob@rlmurray.com .

Buying Your Next Property: Closing

 Oil Region Realty, LLC can walk you through closing - (814) 677-2326
Let's talk about "escrow". To close the sale of a home, a neutral, third party (the escrow holder) is brought into the picture to assure the transaction 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. For example, in an online purchase, PayPal is the secure third party that obtains the buyer's money, and then hands over the money to the seller.

Settling the last details like obtaining funds, signing forms, securing the documents for loans and liens, and assuring you get a clean title to the house in preparation of your purchase gets finalized are all parts of closing in which an escrow agent is useful.

Escrow companies collect the following legal documents:

  • 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
  • Fire and other insurance policies
  • Title insurance policies

Upon completion of all instructions of the escrow, closing can take place. All payments owed 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 transferred to you as new owner and appropriate title insurance is issued as outlined in the escrow policy.

At the close of escrow, payments of funds are made in an acceptable form to the escrow. You'll know when it's time to submit the form of payment.

The Escrow Holder Will:

  • Prepare escrow guidelines
  • Request title research
  • Meet lender's standards as noted in the escrow agreement
  • Receive payments 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 funds and finish instructions

The Escrow Holder Will Not:

  • Offer advice - the escrow agent stays a neutral, third-party status
  • Dispense opinions about the outcome of your taxes
The Escrow Holder Will:
The Escrow Holder Won't:
  • Assemble escrow guidelines
  • Request title inquiry
  • Meet the bank's requirements as written in the escrow agreement
  • Receive payments from the buyer
  • Prorate insurance, tax, interest and other payments according to guidelines
  • Record deeds and other legal documents as instructed
  • Request title insurance policy
  • Close escrow when all instructions of seller and buyer are met
  • Disburse payments and finalize instructions
  • Give advice - the escrow company has to remain an impartial, third-party status
  • Offer opinions about the outcome of your taxes

Mortgage Escrow Account

Often, to pay recurring costs while there's a loan on the house, a Mortgage Escrow Account is created. Though most home buyers make payments via their monthly mortgage payment, Escrow Accounts are deposited into at closing as well.

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

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