Whether it's your first home or your next property, I'll advise you through the process. Contact me and I'll make sure you're a empowered buyer.

First-Time Home Buying: How To Close on a Home

 Craig Jelinek - Sereno Group can walk you through closing - 408-335-1425
First, a little about "escrow". To complete the sale of a place, a neutral, third party (the escrow agent) is employed to assure the process will close properly and on time. A house is said to be in escrow when in the closing process, payment is secured by a third party on behalf of two parties (in this case, a buyer and a seller) when the exchange of money takes place. An easy way to understand the concept of what an escrow company does is to compare it to PayPal for Internet purchases.

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

Escrow companies compile the following documents:

  • 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
  • Terms of sale and any seller-assisted financing

Closing on the property happens when the steps of the escrow are finished. All payments owed and fees are collected and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). Title to the property is then transferred to you as buyer and appropriate title insurance is issued as outlined in the escrow instructions.

When closing is in it's last step, you'll pay the fees to the escrow holder. I'll keep you updated on the procedure.

The Escrow Holder Will:

  • Write escrow instructions
  • Perform a title research
  • Meet lender's requirements as noted in the escrow agreement
  • Intake funds from the buyer
  • Prorate interest, insurance, tax and other payments according to guidelines
  • Record deeds and other documents as instructed
  • Request title insurance policy
  • Close escrow when all instructions of seller and buyer are met
  • Disburse payments and finish instructions

The Escrow Holder Won't:

  • Advise you - the escrow agent has to remain an impartial, third-party status
  • Give insight about the outcome of your taxes
The Escrow Holder Will:
The Escrow Holder Won't:
  • Assemble escrow instructions
  • Petition title inquiry
  • Comply with lender's requirements as outlined in the escrow agreement
  • Receive funds from the buyer
  • Prorate tax, interest, insurance and other fees 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 have been finished
  • Disburse payments and finalize instructions
  • Give advice - the escrow company must maintain a neutral, third-party status
  • Offer opinions about future tax estimations

Mortgage Escrow Account

A Mortgage Escrow Account is established to pay on-going fees while there is a loan on the house. 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 smarter home buyer and future homeowner.

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