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First-Time Home Buying: Closing

 Lake Country Real Estate, Inc. can walk you through closing - (315) 258-9147
First, a little about "escrow". When you're closing on your new home, an escrow agent is used to make certain the process will close properly and in a timely manner. Escrow companies hold money for "safe-keeping" in a deal between a buyer and seller. For example, in an online auction, PayPal is the reliable third party that obtains the buyer's funds, and then sends the funds to the seller.

Tying up any loose ends like receiving funds, completing forms, obtaining the documents for loans and liens, and assuring you get a clean title to the property in preparation of your purchase gets finalized are all part of the job of the escrow agent.

These are the pieces of paperwork that escrow agents usually compile:

  • 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
  • Title insurance policies

You're ready to close when all steps are done in escrow process. All payments owed and fees are taken and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). Title to the home is then transferred to you as new owner and related title insurance is issued as noted in the escrow policy.

At the close of escrow, fees are paid in an acceptable form to the escrow. As your real estate agent, I'll let you know what is an acceptable form of payment.

The Escrow Holder Will:

  • Assemble escrow guidelines
  • Request title research
  • Comply with lender's requirements as written in the escrow agreement
  • Receive payments from the buyer
  • Prorate insurance, tax, interest and other payments according to instructions
  • Record deeds and other documents as instructed
  • Request title insurance policy
  • Close escrow when all terms of agreement of seller and buyer have been met
  • Disburse funds and finish instructions

The Escrow Holder Won't:

  • Advise you - the escrow holder stays at an impartial, third-party status
  • Offer opinions about future tax estimations
The Escrow Holder Will:
The Escrow Holder Won't:
  • Prepare escrow guidelines
  • Perform a title search
  • Meet the bank's requirements as written in the escrow agreement
  • Intake payments from the buyer
  • Prorate interest, insurance, tax and other payments according to instructions
  • Record deeds and other documents as instructed
  • Request title insurance policy
  • Close escrow when all terms of agreement of seller and buyer are complete
  • Disburse monies and finish instructions
  • Offer advice - the escrow holder must stay at a fair, third-party status
  • Give insight about the outcome of your taxes

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.

Once you're at ease with the escrow process, you can be a more assured buyer.

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