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Buying Your Next Property: Closing

 Berkshire Hathaway HomeServices - Anderson Properties can walk you through closing - (405) 823-4928
Escrow: To complete the sale of a property, a neutral, third party (the escrow holder) is brought into the picture to assure the process will close appropriately and on time. Escrow agents hold money for "safe-keeping" in an exchange between a buyer and seller. For example, in an Internet purchase, PayPal is the neutral third party that holds the buyer's cash, and then sends the payment to the seller.

The escrow company makes sure that all terms and conditions of the seller's and buyer's agreement are met prior to the sale being completed. This includes getting payments and documents, completing required forms, and seeking out the release documents for any loans or liens that were paid with the transaction, assuring you have a clean title to your property before the purchase price is fully paid.

These are the legal forms that escrow companies usually compile:

  • 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
  • Fire and other insurance policies

Closing on the house happens when all of the procedures of the escrow are done. All payments owed and fees are collected and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). Title to the home is then given to you as new owner and related title insurance is issued as noted in the escrow instructions.

At the close of escrow, in an acceptable form to the escrow. You'll know when it's time to submit the form of payment.

The Escrow Holder Will:

  • Assemble escrow instructions
  • Request title research
  • Comply with lender's requirements as noted in the escrow agreement
  • Accept payments from the buyer
  • Prorate tax, interest, insurance and other fees according to instructions
  • Record deeds and other legal documents as instructed
  • Obtain title insurance policy
  • Close escrow when all instructions of seller and buyer have been met
  • Disburse payments and finalize instructions

The Escrow Holder Will Not:

  • Give advice - the escrow holder must maintain a neutral, third-party status
  • Give insight about tax implications
The Escrow Holder Will:
The Escrow Holder Won't:
  • Assemble escrow guidelines
  • Petition title research
  • Meet the bank's requirements as noted in the escrow agreement
  • Accept payments from the buyer
  • Prorate insurance, tax, interest and other payments according to guidelines
  • Record deeds and other legal documents as instructed
  • Request title insurance policy
  • Close escrow when all terms of agreement of seller and buyer have been met
  • Disburse monies and finalize instructions
  • Offer advice - the escrow agent has to remain an impartial, third-party status
  • Offer 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. 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.

Now you know more about how to close on your future home. And, you can be a more informed home buyer and future homeowner.

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