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First-Time Home Buying: Closing

 2mac Realty Group can walk you through closing - (817) 675-7700
Escrow: An escrow agent is brought on to assure your home closes on time and the transaction goes smoothly. A property is said to be in escrow when in the closing transaction, money is secured by a third party on behalf of two parties (in this case, a buyer and a seller) when the exchange of money takes place. PayPal is a simple way to think of an escrow company.

The escrow agent makes sure that all terms and conditions of the seller's and buyer's agreement are completed prior to the sale being finalized. This includes receiving monies and records, signing required forms, and getting the release documents for any loans or liens that are to be cleared with the transaction, assuring you have a clear title to your house before the asking price is fully paid.

The documents the escrow holder may secure include:

  • 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
  • Terms of sale and any seller-assisted financing

Upon finishing of all instructions of the escrow, closing can take place. At this time, all payments and fees for inspections, title insurance and real estate commissions are collected. Title to the home is then given to you as buyer and correct title insurance is issued as outlined in the escrow policy.

At the close of escrow, payments are submitted in an acceptable form to the escrow. As your real estate professional, I'll inform you of the acceptable way of paying.

The Escrow Holder Will:

  • Write escrow instructions
  • Request title research
  • Meet lender's guidelines as specified in the escrow agreement
  • Accept payments from the buyer
  • Prorate insurance, tax, interest and other payments according to instructions
  • Record deeds and other legal documents as instructed
  • Obtain title insurance policy
  • Close escrow when all terms of agreement of seller and buyer have been met
  • Disburse payments and finish instructions

The Escrow Holder Won't:

  • Offer advice - the escrow company must stay at a fair, third-party status
  • Offer opinions about the outcome of your taxes
The Escrow Holder Will:
The Escrow Holder Won't:
  • Write escrow guidelines
  • Petition title inquiry
  • Comply with the bank's standards as written in the escrow agreement
  • Receive funds from the buyer
  • Prorate insurance, tax, interest and other payments 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
  • Tell you what's best - the escrow company must maintain a neutral, third-party status
  • Dispense opinions about tax implications

Mortgage Escrow Account

A Mortgage Escrow Account is started to make payments for on-going fees 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.

Once you have the basics of the escrow process down, you can be a confident buyer.

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