Let's talk about "escrow". When you're closing on your new house, an escrow company is used to make sure the transaction will close properly and in a timely manner. When payment is held by a third party in a transaction between a buyer and a seller, it's in escrow. PayPal is a good way to picture an escrow company.
The escrow holder makes sure that all terms and conditions of the seller's and buyer's agreement are completed prior to the sale being completed. This includes getting payments and records, filling out required forms, and seeking out the release documents for any loans or liens that are to be paid with the transaction, assuring you have a free title to your place before the final price is fully paid.
Escrow companies compile the following documents:
- Title insurance policies
- 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
Closing on the home happens when the steps of the escrow are finished. All payments owed and fees are taken and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). You'll then receive the title to the property and the title insurance gets dispersed as noted in the escrow instructions.
At the close of escrow, payments are submitted in an acceptable form to the escrow. As your REALTOR, I'll let you know what is an acceptable form of payment.