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First-Time Home Buying: Closing

 At Home Real Estate Company can walk you through closing - (970) 203-1101
Let's talk about "escrow". To close the sale of a place, a neutral, third party (the escrow holder) is brought into the picture to assure the process will close correctly and on time. When money is held by a third party in a transaction between a buyer and a seller, it's in escrow. For example, in an Internet purchase, PayPal is the secure third party that obtains the buyer's funds, and then hands over the funds to the seller.

Clearing the final hurdles like taking in funds, finishing forms, getting 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 part of the job of the escrow holder.

The records the escrow holder 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

Closing on the house takes place when the steps of the escrow are done. At this time, all payments and dues for inspections, title insurance and real estate commissions are taken. You'll then secure the title to the home and the title insurance gets dispersed as outlined in the escrow instructions.

At the close of escrow, fees are paid in an acceptable form to the escrow. You'll know when it's time to submit the form of payment.

The Escrow Holder Will:

  • Write escrow instructions
  • Request title research
  • Comply with lender's guidelines as noted in the escrow agreement
  • Receive payments from the buyer
  • Prorate tax, interest, insurance and other fees according to guidelines
  • Record deeds and other documents as instructed
  • Request title insurance policy
  • Close escrow when all terms of agreement of seller and buyer are met
  • Disburse payments and finish instructions

The Escrow Holder Will Not:

  • Offer advice - the escrow company stays a neutral, third-party status
  • Dispense opinions about tax implications
The Escrow Holder Will:
The Escrow Holder Won't:
  • Assemble escrow instructions
  • Petition title search
  • Meet the bank's guidelines as noted in the escrow agreement
  • Accept payments from the buyer
  • Prorate insurance, tax, interest and other payments according to guidelines
  • Record deeds and other legal documents as instructed
  • Request title insurance policy
  • Close escrow when all instructions of seller and buyer are met
  • Disburse funds and finalize instructions
  • Give advice - the escrow company has to remain an impartial, third-party status
  • Offer opinions about the outcome of your taxes

Mortgage Escrow Account

Creating a Mortgage Escrow Account helps keep track of on-going expenses while there's a loan on your 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.

Now you know more about how to close on your future home. And, you can be a smarter home buyer and future homeowner.

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