Let's talk about "escrow". To finish the sale of a place, a neutral, third party (the escrow agent) is employed to assure the transaction will close perfectly and on time. Escrow companies hold money for "safe-keeping" in a deal between a buyer and seller. An everyday way to understand what an escrow company does is to compare it to PayPal for online purchases.
The escrow company is careful to assure that all terms and conditions of the seller's and buyer's agreement are reached prior to the sale being finished. This includes securing funds and documents, finishing required forms, and obtaining the release documents for any loans or liens that are to be paid off with the transaction, assuring you have a free title to your place before the final price is fully paid.
These are the legal documents that escrow holders usually look to collect:
- 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 portions of the escrow, closing can take place. All expenses like title insurance, inspections and real estate commissions are paid. You'll then receive the title to the house and the title insurance gets issued as stated in the escrow instructions.
At the close of escrow, payments of funds are made in an acceptable form to the escrow. As your REALTOR, I'll inform you of the acceptable form of payment.