First-Time Home Buying: How To Close on a Property

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Escrow
To complete the sale of a house, a neutral, third party (the escrow agent) is engaged to assure the process will close perfectly and on time. Escrow agents hold money for "safe-keeping" in transactions between a buyer and seller. For example, in an online transaction, PayPal is the neutral third party that holds the buyer's payment, and then sends the funds to the seller.

The escrow holder makes sure that all terms and conditions of the seller's and buyer's contract are completed prior to the sale being finalized. This includes securing monies and documents, filling out required forms, and getting the release documents for any loans or liens that were paid off with the transaction, assuring you have a clear title to your property before the agreed upon price is fully paid.

Purchasing a property for the first time can be intimidating. We can help. E-mail us at eric@movedowntowncolumbus.com to get some free information.

The records the escrow holder may secure include:

  • Loan documents
  • Tax statements
  • 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

You're ready to close when every step is complete in escrow process. At this time, all payments and dues for inspections, title insurance and real estate commissions are paid out. The home's title gets transferred to you and title insurance is issued per the policies of your particular escrow process.

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.

The Escrow Holder Will:
The Escrow Holder Won't:
  • Write escrow guidelines
  • Request title research
  • Comply with the bank's requirements as noted in the escrow agreement
  • Intake payments from the buyer
  • Prorate tax, interest, insurance and other fees 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 payments and finish instructions
  • Advise you - the escrow agent has to remain an impartial, third-party status
  • Dispense opinions about tax implications

Mortgage Escrow Account

Creating a Mortgage Escrow Account helps keep track of on-going expenses while there's a loan on your house. Generally, the Escrow Account is partially funded at closing and the home buyer makes on-going contributions through their monthly mortgage payment.

Once you're familiar with the escrow process, you can be a informed buyer.