What to Expect When You're in Escrow

Whether it's your first property or your next home, I'll walk you through the process. E-mail me at lw29@comcast.net .

The Property is Almost Yours

Louis Wolfson & Co. can walk you through closing - (617) 799-3326

First, a little about "escrow". A neutral, third party (known as the escrow holder or the escrow agent) is brought on to assure your home closes on time and the transaction goes smoothly. Escrow agents hold money for "safe-keeping" in an exchange between a buyer and seller. For example, in an online transaction, PayPal is the reliable third party that holds the buyer's cash, and then disburses the money to the seller.

The escrow holder makes sure that the terms and conditions of the agreement between the two parties are performed in preparation of the sale being finished.

Escrow companies collect the following pieces of paperwork:

Fire and other insurance policies
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

Upon completion of all portions of the escrow, closing can take place. All expenses like title insurance, inspections and real estate commissions are paid. You'll then receive the title to the home and the title insurance gets dispersed as noted in the escrow instructions.

The escrow company receives a payment when the closing is complete. As your real estate professional, I'll inform you of the acceptable way of paying.

The Escrow Holder Will:

Write escrow instructions
Petition title search
Comply with the bank's requirements as written in the escrow agreement
Intake payments from the buyer
Prorate interest, insurance, tax and other payments according to instructions
Record deeds and other legal documents as instructed
Request title insurance policy
Close escrow when all terms of agreement of seller and buyer have been finished
Disburse funds and finish instructions

The Escrow Holder Will Not:

Tell you what's best - the escrow agent must stay at a fair, third-party status
Give insight about future tax estimations

The Escrow Holder Will:		The Escrow Holder Won't:
Assemble escrow instructions Request title inquiry Meet the bank's requirements as outlined in the escrow agreement Accept payments from the buyer Prorate tax, interest, insurance and other fees according to guidelines Record deeds and other documents as instructed Obtain title insurance policy Close escrow when all instructions of seller and buyer are met Disburse funds and finalize instructions		Give advice - the escrow agent must maintain a neutral, third-party status Dispense opinions about future tax estimations

Mortgage Escrow Account

A Mortgage Escrow Account is used to make payments for on-going expenses while there is a loan on the 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.

This is a quick run-down of the escrow process. Your individual methods might be different based on your lender and your escrow company.

Got a Question?

Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.