What is escrow?
When you’re selling, transferring, or leasing property, the person you’re doing business with will often deliver a written promise, money, or an item of value to a neutral third party for safekeeping. Once the transaction is complete, the third party will deliver the promised payment. This third party is your escrow agent, title agent, or closing attorney depending on where you live. The person or company in charge of escrow is responsible for receiving necessary funds and documents, completing required forms, and handling final delivery of all items to the right people once your transaction is completed.
What do I have to give my escrow/title agent?
Your agent needs all the necessary information to take care of your transaction. This might include loan documents, tax statements, insurance policies, terms of sale, any financing obtained by a buyer, and any other services that will be paid out of the escrow funds.
What will my agent do?
Once they have everything they need, your agent will obtain signatures from everyone involved in the escrow and collect all outstanding funds and fees—title insurance premiums, real estate commissions, inspection charges, etc. Finally your agent will transfer the property title according to the terms in the escrow instructions and any title insurance policies issued.
What does “opening escrow” mean?
Basically this means starting the closing process by visiting an escrow company’s office and handing over the deposit money and instructions for the transaction. Usually your real estate agent will take the initiative to open escrow for you, but in for-sale-by-owner transactions, either the buyer or the seller or both together will open escrow.