Life of an Escrow
The processing of a real estate transaction is handled differently depending on which area of the United States you are in. Much of the eastern United States uses a formal closing process that requires the services of attorneys. The western part of the United States allows these services to be provided by escrow at a significant savings to your customer. Escrow Agents are not parties to a real estate closing. Their place in the transaction is fiduciary to all parties involved in the entire transaction.
Escrow begins processing and coordinating the flow of documents. The escrow and conveying documents (Deed to transfer property) are drawn and sent to Buyer and Seller for proper execution. Although it is not the job of escrow agent to cure defects of title, performance, or other services extraneous to closing the transaction, Escrow Agent may assist in helping to determine what steps may be taken in order to clear any extraordinary circumstances that are disclosed by the Preliminary Title Report.
Upon receipt of properly executed documents, the Escrow officer will review all the documents involved in the transaction to make sure they fit the transaction as contracted for. A thorough investigation that everything needed to close the transaction has been satisfied. The analysis will include, but is not limited to the following; the proper execution of escrow and mortgage documents, checking that all taxes have been paid and prorated between buyer and seller when necessary, ensuring financial consideration has passed and all monetary consideration can be properly disbursed. After good funds are received, the escrow officer, balances the disbursement sheet, ensures the transferring documents are filed of record at the County Recorder's office and funds and closes the escrow file. Last, but certainly not least, the title policies are prepared and forwarded on to the owner and Lender.
- The key to facilitating the process is communication- an open line of communication between agents, clients and escrow.
- Respond quickly to correspondence. A fast response can often prevent misunderstandings and error and will assist in timely closing.
- Establish a relationship with your Escrow Agent. Ensure you are updated on the progress of the transaction.
- Provide the Escrow company with as much information as possible. Open escrow with complete contracts, including full signatures, addresses and phone numbers for the parties involved.
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