What Happens in Escrow?

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Escrow is the depositing of funds and documents by the parties with an impartial third party for delivery upon completion of the terms of the escrow instruction. The word escrow is derived from the French word escroue meaning a scroll or roll of writing. OPENING ESCROW Escrow opens when one of the Realtors representing either the Buyer or the Seller gives the deposit check and the documents of the agreement to an Escrow Company. When the parties deliver documents and money to the impartial Escrow Officer, we say the documents are held in escrow. We may also say the parties have opened an escrow. Each of the principals of the escrow (seller, buyer, lender) will give the escrow holder written instructions setting out the conditions under which the further delivery is to be made. These instructions are usually prepared by the Escrow Officer or the Escrow Secretary from information supplied by the principals or from a contract signed before they arrived at the escrow office.   THE PURPOSE OF AN ESCROW  The common use of an escrow is to enable the parties in a real estate transaction to deal with each other with less risk, since the escrow holder acts as: Custodian for funds and documents. A clearing house for payment of all demands. An agency to perform the clerical details for the settlement of the accounts between the parties.

CLOSE OF ESCROW Prepare for it Closing marks the end of your home buying process and the beginning of your new life! To make sure your closing goes smoothly, you should bring the following for your final escrow appointment: A certified check for closing costs and down payment. Make the check payable to yourself and you will then endorse it to the title company at closing An insurance binder and paid receipt Photo IDs Social security numbers Addresses for the past 10 years Wait for it Transfer of title moves ownership of the property from the seller to you. The two events happen before actual change of ownership. They are: Delivery of the buyers funds This is the check or wire funds provided by your lender in the amount of the loan Delivery of the deed to title company A deed is the document that transfers ownership of real estate. The deed names the seller and buyer, gives a legal description of the property, and contains the notarized signatures of the seller and witnesses. Own it At the close of escrow the deed will be taken and recorded at the county clerks office. Ownership changes from seller to buyer when the deed is recorded. Notification of recordation will be done through the escrow company and through your Realtor. The process takes a couple of days from the time that you bring the money into escrow and sign the loan documents. Plan on a Monday appointment for a Thursday or Friday close of escrow.

More Information We frequently use Linda Overton, a terrific escrow officer at Glen Oaks Escrow in Valencia. Click for more FAQs.