First, a little about "escrow". An escrow company is brought on to assure your property closes on time and the closing process goes smoothly. Escrow agents hold money for "safe-keeping" in an exchange between a buyer and seller. For example, in an Internet purchase, PayPal is the reliable third party that holds the buyer's money, and then hands over the payment to the seller.
Settling the last details like receiving funds, signing forms, obtaining the documents for loans and liens, and assuring you get a clean title to the house in preparation of your purchase gets finalized are all parts of closing in which an escrow holder is useful.
The pieces of paperwork the escrow holder may obtain include:
- Terms of sale and any seller-assisted financing
- 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
You're ready to close when every step is complete in escrow process. At this time, all payments and dues for inspections, title insurance and real estate commissions are taken. Title to the home is then transferred to you as new owner and related title insurance is issued as outlined in the escrow policy.
The escrow holder receives a payment at the completion of closing. I'll keep you up-to-date on what comes next.