Whether it's your first house or your next property, I'll advise you through the process. E-mail me at shannon@southerntraderealty.com .

What is Escrow?

 Southern Trade Realty, Inc. can walk you through closing - (804) 694-3113
First, a little about "escrow". To finish the sale of a house, a neutral, third party (the escrow agent) is employed to assure the transaction will close correctly and on time. When funds are held by a third party in a transaction between a buyer and a seller, it's in escrow. For example, in a Web transaction, PayPal is the neutral third party that holds the buyer's cash, and then disburses the money to the seller.

The escrow holder makes sure that the terms and conditions of the agreement between the sellers and the buyers are performed in preparation of the sale being finished.

Escrow companies compile the following forms:

  • Loan documents
  • Tax statements
  • Fire and other insurance policies
  • Title insurance policies
  • Terms of sale and any seller-assisted financing
  • Requests for payment for various services to be paid out of escrow funds

Upon completion of all instructions of the escrow, closing can take place. All expenses like title insurance, inspections and real estate commissions are paid. Title to the home is then given to you as new homeowner and appropriate title insurance is issued as noted in the escrow instructions.

When closing is done, you'll make a payment to the escrow holder. As your REALTOR, I'll inform you of the acceptable form of payment.

The Escrow Holder Will:

  • Prepare escrow guidelines
  • Petition title inquiry
  • Comply with lender's guidelines as specified in the escrow agreement
  • Receive funds from the buyer
  • Prorate insurance, tax, interest and other payments according to guidelines
  • Record deeds and other paperwork as instructed
  • Obtain title insurance policy
  • Close escrow when all terms of agreement of seller and buyer are complete
  • Disburse funds and finalize instructions

The Escrow Holder Will Not:

  • Give advice - the escrow company stays at an impartial, third-party status
  • Dispense opinions about tax implications
The Escrow Holder Will:
The Escrow Holder Won't:
  • Prepare escrow guidelines
  • Perform a title inquiry
  • Meet lender's guidelines as specified in the escrow agreement
  • Receive funds from the buyer
  • Prorate insurance, tax, interest 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 are complete
  • Disburse monies and finish instructions
  • Offer advice - the escrow agent must stay at a fair, third-party status
  • Offer opinions about future tax estimations

Mortgage Escrow Account

A Mortgage Escrow Account is used to make payments for rolling expenses while there is a loan on the house. 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.

Once you have the ABCs of the escrow process down, you can be a better buyer.

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