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Buying Your Next Home: Closing

 Metro Properties can walk you through closing - 866-300-1550
Let's talk about "escrow". When you're closing on your new home, a neutral, third party (known as the escrow holder or the escrow agent) is used to make sure the process will close correctly and in a certain amount of time. Escrow holders hold money for "safe-keeping" in an exchange between a buyer and seller. An easy way to understand what an escrow company does is to think of how you might use PayPal for online purchases.

The escrow company insures that all terms and conditions of the seller's and buyer's negotiated agreement are completed prior to the sale being completed. This includes securing monies and records, filling out required forms, and seeking out the release documents for any loans or liens that were paid with the transaction, assuring you have a clean title to your property before the negotiated price is fully paid.

Escrow holders 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 house happens when all of the procedures of the escrow are complete. All expenses like title insurance, inspections and real estate commissions are paid. Title to the property is then given to you as new homeowner and related title insurance is issued as noted in the escrow instructions.

When closing is finished, you'll submit a payment to the escrow company. As your agent, I'll let you know what is an acceptable way of paying.

The Escrow Holder Will:

  • Prepare escrow guidelines
  • Request title inquiry
  • Comply with the bank's guidelines as specified in the escrow agreement
  • Intake funds from the buyer
  • Prorate interest, insurance, tax and other payments according to instructions
  • Record deeds and other documents as instructed
  • Obtain title insurance policy
  • Close escrow when all terms of agreement of seller and buyer have been finished
  • Disburse funds and finish instructions

The Escrow Holder Will Not:

  • Tell you what's best - the escrow holder must stay at a fair, third-party status
  • Dispense opinions about future tax estimations
The Escrow Holder Will:
The Escrow Holder Won't:
  • Prepare escrow guidelines
  • Petition title research
  • Comply with lender's guidelines as specified in the escrow agreement
  • Accept payments from the buyer
  • Prorate interest, insurance, tax and other payments according to instructions
  • Record deeds and other legal documents as instructed
  • Request title insurance policy
  • Close escrow when all instructions of seller and buyer have been finished
  • Disburse funds and finish instructions
  • Advise you - the escrow agent stays at an impartial, third-party status
  • Dispense opinions about the outcome of your taxes

Mortgage Escrow Account

Creating a Mortgage Escrow Account helps keep track of on-going expenses while there's a loan on your house. Though most home buyers make payments via their monthly mortgage payment, Escrow Accounts are deposited into at closing as well.

Once you're familiar with the escrow process, you can be a more assured buyer.

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