If you’re looking to buy a home, you’re going to be hearing the word escrow a lot. Escrow is, in very general terms, the transition process of the sale of a home according to specific laws.
Let’s say you’ve found your dream home, and are ready to buy it. Congratulations! Once you and the seller have agreed on a price, you will begin the escrow process. Escrow was created in order to guarantee that all steps in the sale transaction are completed. It’s a very safe process. Money for the purchase of the home will be placed in an escrow account, under the supervision of an escrow officer. This person is in charge of overseeing the process, and will be chosen by mutual agreement between the parties involved. He or she will receive, sign, and transfer all documents involved in the process, and make sure that all instructions are followed to the letter. The parties involved in escrow will be the buyer, seller, lender, and borrower. It’s between these parties that money will be exchanged. If there is a broker involved, he or she will receive all documents and deeds and legal affairs from the different parties involved, and then bring them to the escrow officer.
The escrow officer is authorized to execute all instructions and directions from the parties involved in the sale; process the funds and documentation of the sale according to the wishes of the parties involved; pay bills when instructed to do so; and finally, close the escrow account once all its terms have been met.
If you’re thinking of buying a home, be sure to do as much research as you can on all aspects of the escrow process. On top of that, schedule an appointment with a financial adviser who can give you the benefits of his or her advice. Buying a home is a very big deal, and you need to know as much about the process as possible.