Escrow: An escrow holder is hired to assure your home closes on time and the transaction goes smoothly. When payment is held by a third party in a transaction between a buyer and a seller, it's in escrow. For example, in an Internet transaction, PayPal is the neutral third party that holds the buyer's cash, and then disburses the payment to the seller.
Tying up any loose ends like obtaining funds, signing forms, getting the documents for loans and liens, and assuring you get a spotless title to the home before your purchase gets finalized are all part of the job of the escrow agent.
The records 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
Closing on the home takes place when the steps of the escrow are finished. All outstanding payments and fees are collected and paid off at this time (covering expenses such as title insurance, inspections, real estate commissions). The property's title gets transferred to you and title insurance begins per the steps of your individual escrow agreement.
At the close of escrow, payments of funds are made in an acceptable form to the escrow. As your REALTOR, I'll let you know what is an acceptable way of paying.