The escrow holder makes sure that all terms and conditions of the seller's and buyer's negotiated agreement are completed prior to the sale being finalized. This includes securing payments and paperwork, completing required forms, and obtaining the release documents for any loans or liens that were paid off with the transaction, assuring you have a free title to your house before the purchase price is fully paid.
The documents the escrow agent may obtain include:
Upon finishing of all portions of the escrow, closing can take place. All payments owed and fees are taken and paid off at this time (covering expenses such as title insurance, inspections, real estate commissions). You'll then get the title to the house and the title insurance gets dispersed as outlined in the escrow instructions.
At the close of escrow, payments are submitted in an acceptable form to the escrow. You'll know when it's time to submit the form of payment.
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.
Now you know more about being in escrow. And, you can be a more confident home buyer and future homeowner.
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