First, a little about "escrow". To complete the sale of a home, a neutral, third party (the escrow agent) is employed to assure the transaction will close properly and on time. A property is said to be in escrow when in the closing process, funds is held by a third party on behalf of two parties (in this case, a buyer and a seller) when the transaction is taking place. PayPal is a good way to picture an escrow company.
Tying up any loose ends like obtaining funds, completing forms, obtaining the documents for loans and liens, and making sure you get a clean title to the property before your purchase gets finalized are all parts of closing in which an escrow company is useful.
These are the records that escrow companies usually look to collect:
- 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
- Loan documents
Closing on the house happens when all of the procedures of the escrow are complete. All expenses like title insurance, inspections and real estate commissions are paid. Title to the home is then transferred to you as new owner and correct title insurance is issued as outlined in the escrow instructions.
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 form of payment.