The Life of an Escrow

It All Begins With The Offer & Acceptance Skillfully Negotiated By Your

Century 21 The United Group Agent…

The Buyer(s)

♦ Submits a written offer to purchase or accepts the Seller’s counter offer accompanied by a good faith deposit amount.  ♦ Applies for a new loan, completing all required forms and often prepaying certain fees such as credit report and appraisal costs.  ♦ Approves the preliminary report, and any property disclosure, or inspection re-ports called for by the purchase and sale agreement (Deposit Receipt).  ♦ Approves and signs the escrow instructions, new loan documents and other related instruments required to complete the transaction.  ♦ Fulfills any remaining conditions specified in the contract, lender’s instruction and/or the escrow instructions.  ♦ Approves any final changes by signing amendments to the escrow instructions or contract.  ♦ Deposits sufficient funds in the escrow to pay the remaining down payment and closing costs.

The Lender

♦ Accepts the new loan application and other related documents from the Buyer(s) and begins the qualification process.  ♦ Orders and reviews the property appraisal, credit report, verification of employment, verification of deposit(s), preliminary report and other related information.  ♦ Submits the entire package to the loan committee and/or underwriters for approval. When approved, loan conditions and title insurance requirements are established.  ♦ Informs Buyer(s) of loan approval terms and commitment expiration date and provides a good faith estimate of the closing costs.  ♦ Deposits the new loan documents and instructions with the escrow holder for Buyer’s approval and signature.  ♦ Reviews and approves the executed loan package and coordinates the loan funding with the escrow officer.

The Escrow Officer

♦ Receives an order for the title and escrow services for.  ♦ Orders the title search and examination on subject property.  ♦ Acts as the impartial “stakeholder” or depository, in a fiduciary capacity, for all documents and monies required to complete the transaction per written instructions of the principals.  ♦ With authorization from the real estate agent or principal, orders demands on existing deeds of trust and liens or judgements, if any. For an assumption or subject to loan, orders the beneficiary’s statement or formal assumption package.  ♦ Reviews documents received in the escrow: preliminary report, payoff or assumption statements, new loan package and other related instruments. Reviews the conditions in the lender’s instructions including the hazard and title insurance requirements.  ♦ Prepares the escrow instructions and required documents together with a preliminary estimate of settlement charges, for the Buyer and Seller, in accordance with the terms of the sale.  ♦ Presents the instructions, documents, statements, loan package(s) and other related documents to the principal(s) for approval and signature.  ♦ Reviews the signed instructions and documents, returns the loan package, and requests the lender’s funds.  ♦ Receives the balance of funds required from the Buyer and/or the proceeds of the loan from the lender.  ♦ Determines when the transaction will be in the position to close and advises the parties.  ♦ Assisted by title personnel, records the deed, deed of trust and other documents required to complete the transaction with the County Recorder and orders the title insurance policies.  ♦ Closes the escrow by preparing the final settlement statements disbursing the proceeds to the Seller, paying off the existing encumbrances and other obligations. Delivers the appropriate statements, funds and remaining documents to the principals, agents and/or the lenders.

The Sellers

♦ Accepts Buyer’s offer to purchase and initial good faith deposit to open escrow.  ♦ Submits documents and information to the escrow holder, such as: addresses of lien holders, tax receipts, any leases and/or rental agreements, etc.  ♦ Orders inspections, receives clearances and approves final reports and/or repairs to the property as required by the terms of the purchase and sale agreement (Deposit Receipt).  ♦ Approves and signs the escrow payoff demands, grant deed and other related documents required to complete the transactions.  ♦ Fulfills any remaining conditions specified in the contract and/or escrow instructions.  ♦ Approves any final changes by signing amendments to the escrow instructions or contracts.

The Title Company

♦ Examines the title to the real property and issues a preliminary report.  ♦ Determines the requirements and documents needed to complete the transaction and advises the escrow officer and/or agents.  ♦ Reviews and approves the signed documents, and releases the order for title insurance prior to the closing date.  ♦ When authorized by the escrow officer, records the signed documents with the County Recorder’s office and prepares to issue the title insurance policies..

 

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