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What To Expect When You're Closing in Medway

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Escrow: A neutral, third party (known as the escrow holder or the escrow agent) is hired to assure your house closes on time and the money exchanging part of closing goes smoothly. A property is said to be in escrow when in the closing process, funds is held by a third party on behalf of a buyer and a seller when the transaction is taking place. PayPal is a good example of an escrow company.

The escrow holder makes sure that all terms and conditions of the seller's and buyer's contract are reached prior to the sale being completed. This includes receiving funds and certificates, filling out required forms, and obtaining the release documents for any loans or liens that are to be cleared with the transaction, assuring you have a free title to your place before the agreed upon price is fully paid.

The documents the escrow agent may obtain 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

You're ready to close when every step is done in escrow process. All outstanding payments and fees are collected and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). You'll then obtain the title to the house and the title insurance gets dispersed as outlined in the escrow instructions.

At the close of escrow, in an acceptable form to the escrow. I'll keep you informed on the procedure.

The Escrow Holder Will:

  • Prepare escrow guidelines
  • Petition title research
  • Meet the bank's guidelines as specified 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
  • Request title insurance policy
  • Close escrow when all instructions of seller and buyer have been finished
  • Disburse funds and finalize instructions

The Escrow Holder Won't:

  • Offer advice - the escrow holder must stay at a fair, third-party status
  • Offer opinions about tax implications
The Escrow Holder Will:
The Escrow Holder Won't:
  • Prepare escrow guidelines
  • Request title inquiry
  • Comply with the bank's requirements as outlined 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
  • Request title insurance policy
  • Close escrow when all terms of agreement of seller and buyer are complete
  • Disburse payments and finalize instructions
  • Tell you what's best - the escrow agent must stay at a fair, third-party status
  • Offer opinions about tax implications

Mortgage Escrow Account

Often, to pay recurring costs while there's a loan on the house, a Mortgage Escrow Account is created. Though most home buyers make payments via their monthly mortgage payment, Escrow Accounts are deposited into at closing as well.

This is a quick run-down of the escrow process. Your specific process might vary based on your lender and your escrow holder.

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