Under Escrow: What Does It Mean?
Once you've found the home you want, the waiting begins. There is much to do while you wait for your mortgage to be approved, however. The time between when the seller accepts your offer and you close on your home may be known by various names but often your real estate agent will simply call it "under escrow". To find out what is happening and what needs to happen during this time, read on.
The Escrow Players
Many buyers have already dealt with a real estate agent or two along with a mortgage lender and the seller. Once your home enters escrow, that group is joined by several others. In some cases, you might now be dealing with the following agencies and businesses:
Homeowner Insurance Agencies — You must have this insurance if you are financing your home.
Home Inspectors — Many lenders require that you have a professional home inspection performed as soon as possible after the contract is signed. That ensures there will be plenty of time left over to have any repairs performed before the closing date.
Appraisers — You may be required to have one or more professional real estate appraisals performed on your home.
Title Companies — In many cases, title companies are associated with your real estate agent but not always. This firm specializes in title research to ensure that the real seller is selling you the home. In most cases, they also provide the buyer with title insurance to cover any legal issues that might arise after the sale.
The Escrow Company
The word escrow is connected to the bank account where your deposit on the home is held pending the closing. This is known as an escrow account. Also, you may make payments to your lender for your property taxes and your homeowners' insurance along with your mortgage payment each month. Since those two bills are only due once a year, your funds are held in an escrow account until they are due. In many cases, the escrow company helps keep things on track so that the closing is not delayed. They keep up with issues and work to smooth the way. For example, they might help you work out the details of repairs on your home being paid for by the seller. They also work closely with the lender to ensure the approval process is coming to a conclusion. Finally, the escrow company traditionally hosts the closing conference.
Having an on-time closing is not only positive for the buyers and sellers but delays can cause a number of paperwork and financial nightmares. To find out more, contact a company like The Valicenti Team - Colorado Group Realty.