How Escrow Works
Using an Escrow Agent When Buying a Home
Sue King and her team of Real Estate Professionals at Greater Orlando
Realty USA, Inc. can walk you through closing when buying a home in
Orlando and Central Florida.
Call: (407) 492-9353
What is Escrow
When you're closing on your new place in Orlando or Central Florida, an escrow agent is used to ensure the process will close correctly and on time. A property is said to be in escrow when in the closing process, money is secured by a third party on behalf of two parties when the exchange of money takes place. A simple way to think of what an escrow company does is to think of how you might use PayPal for online purchases.
Settling the last details like obtaining funds, finishing forms, getting the documents for loans and liens, and making sure you get a clean title to the property in preparation of your purchase gets finalized are all part of the job of the escrow company.
Whether it's your first property or your next property, Sue King of Greater Orlando Realty USA, Inc. will walk you through the process. Call us at (407) 492-9353
The pieces of paperwork the escrow company may secure include:
- 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
You're ready to close when every step is finished in escrow process. At this time, all payments and dues for inspections, title insurance and real estate commissions are taken. Title to the house is then given to you as new owner and related title insurance is issued as outlined in the escrow policy.
At the close of escrow, payments are submitted in an acceptable form to the escrow. You'll know when it's time to submit the form of payment.
What The Escrow Holder Will Do:
- Prepare escrow instructions
- Request title inquiry
- Meet lender's guidelines as outlined in the escrow agreement
- Accept funds from the buyer
- Prorate tax, interest, insurance and other fees according to guidelines
- Record deeds and other legal documents as instructed
- Obtain title insurance policy
- Close escrow when all instructions of seller and buyer are met
- Disburse payments and finalize instructions
What The Escrow Holder Won't Do:
- Offer advice - the escrow holder must maintain a neutral, third-party status
- Give insight about future tax estimations
- Mortgage Escrow Account
Often, to pay recurring costs while there's a loan on the house, a Mortgage Escrow Account is created. Usually, the home buyer makes a payment at closing and also makes regular deposits through their monthly mortgage payment to fund the Escrow Account.
Now you know more about being in escrow. And through this knowledge you can be a more confident home buyer and future homeowner.