Let's talk about "escrow". To close the sale of a house, a neutral, third party (the escrow agent) is employed to assure the process will close appropriately and on time. Escrow companies hold money for "safe-keeping" in transactions between a buyer and seller. For example, in a Web purchase, PayPal is the neutral third party that obtains the buyer's funds, and then disburses the payment to the seller.
The escrow holder is careful to assure that all terms and conditions of the seller's and buyer's agreement are met prior to the sale being finalized. This includes getting monies and documents, finishing required forms, and seeking out the release documents for any loans or liens that were paid with the transaction, assuring you have a free title to your house before the agreed upon price is fully paid.
The documents the escrow agent may collect 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
Closing on the property takes place when the steps of the escrow are complete. At this time, all payments and dues for inspections, title insurance and real estate commissions are paid out. You'll then obtain the title to the property and the title insurance gets dispersed as stated in the escrow instructions.
At the close of escrow, in an acceptable form to the escrow. I'll keep you informed on the procedure.