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Completing the Transaction

 David Massey Real Estate can walk you through closing - (336) 226-9374
Let's talk about "escrow". An escrow agent is brought on to assure your place closes on time and the transaction goes smoothly. Escrow agents hold money for "safe-keeping" in transactions between a buyer and seller. A simple 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 insures that all terms and conditions of the seller's and buyer's contract are met prior to the sale being completed. This includes getting payments and paperwork, signing required forms, and seeking out the release documents for any loans or liens that are to be cleared with the transaction, assuring you have a free title to your home before the purchase price is fully paid.

Escrow companies want to acquire the following records:

  • 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

Closing on the home takes place when the steps of the escrow are finished. All expenses like title insurance, inspections and real estate commissions are paid. The property's title gets transferred to you and title insurance is issued per the policies of your individual escrow process.

When closing is done, you'll submit a payment to the escrow agent. You'll know when it's time to submit the form of payment.

The Escrow Holder Will:

  • Write escrow guidelines
  • Request title inquiry
  • Meet the bank's requirements as written in the escrow agreement
  • Accept payments from the buyer
  • Prorate insurance, tax, interest and other payments according to guidelines
  • Record deeds and other documents as instructed
  • Obtain title insurance policy
  • Close escrow when all terms of agreement of seller and buyer are met
  • Disburse payments and finish instructions

The Escrow Holder Won't:

  • Advise you - the escrow company stays at an impartial, third-party status
  • Give insight about the outcome of your taxes
The Escrow Holder Will:
The Escrow Holder Won't:
  • Prepare escrow instructions
  • Petition title research
  • Meet the bank's requirements as outlined in the escrow agreement
  • Receive payments from the buyer
  • Prorate insurance, tax, interest and other payments according to instructions
  • Record deeds and other paperwork as instructed
  • Request title insurance policy
  • Close escrow when all instructions of seller and buyer have been met
  • Disburse payments and finish instructions
  • Tell you what's best - the escrow agent must stay at a fair, third-party status
  • Offer opinions about tax implications

Mortgage Escrow Account

Often, to pay recurring costs while there's a loan on the house, a Mortgage Escrow Account is created. 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.

This is a easy to understand guide about the escrow process. Your individual methods might vary based on your lender and your escrow agent.

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