Let's talk about "escrow". To finish the sale of a place, a neutral, third party (the escrow agent) is engaged to assure the transaction will close perfectly and on time. Escrow holders hold money for "safe-keeping" in an exchange between a buyer and seller. A simple way to understand the concept of what an escrow company does is to think of how you might use PayPal for online purchases.
The escrow holder makes sure that the terms and conditions of the agreement between the seller and buyer are reached in preparation of the sale being finished.
These are the legal forms that escrow holders usually look for:
- 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
Upon completion of all portions of the escrow, closing can take place. All expenses like title insurance, inspections and real estate commissions are paid. Title to the house is then given to you as buyer and appropriate title insurance is issued as outlined in the escrow policy.
The escrow company gets a payment when the closing is complete. I'll keep you updated on the procedure.