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What To Expect When You're Closing in Lake Norman
Escrow: When you're closing on your new home, an escrow agent is used to insure the transaction will close correctly and in a certain amount of time. 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 transaction is taking place. An easy way to understand what an escrow company does is to think of the use of PayPal for online purchases.
The escrow company insures that all terms and conditions of the seller's and buyer's agreement are reached prior to the sale being finalized. This includes securing funds and records, 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 home before the purchase price is fully paid.
Escrow companies look for the following records:
- 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. The property's title is given to you and title insurance begins per the steps of your particular escrow process.
At the close of escrow, payment of funds shall be made in an acceptable form to the escrow. As your agent, I'll let you know what is an acceptable form of payment.
The Escrow Holder Will:
The Escrow Holder Won't:
- Assemble escrow guidelines
- Petition title research
- Comply with lender's standards as outlined in the escrow agreement
- Intake payments from the buyer
- Prorate interest, insurance, tax and other payments according to instructions
- Record deeds and other paperwork as instructed
- Request title insurance policy
- Close escrow when all terms of agreement of seller and buyer have been met
- Disburse funds and finish instructions
- Give advice - the escrow agent has to remain an impartial, third-party status
- Dispense opinions about future tax estimations
Mortgage Escrow Account
Often, to pay recurring costs while there's a loan on the house, a Mortgage Escrow Account is created. Usually, the home buyer makes a payment at closing and also makes regular deposits through their monthly mortgage payment to fund the Escrow Account.
Now you know more about being in escrow. And, you can be a more informed home buyer and future homeowner.
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