Glen Oaks Escrow

Can Escrow Close if I’m Out of Town?

There may be an instance where you and/or your spouse have to leave town when your escrow is closing.  Fortunately, there are a couple solutions to this problem, so you don’t need to worry about delaying the close of escrow.

Some escrow companies allow escrow instructions to be signed and faxed or emailed, as long as all original signed copies will be presented a couple days later.  However, most escrow companies will not accept a faxed copy of signatures because of the possibility of them being “forged”.  Make sure to contact your escrow company to ask what their policies are regarding this matter.

The best solution, and the one that is most commonly used and accepted in cases like this, is to select someone to sign on your behalf.  To do this, you must complete a Power of Attorney form signed and notarized and provide the original copy to your escrow holder.  It’s a good idea to use a limited Power of Attorney to a single real estate transaction.  Once you return, make sure to cancel the Power of Attorney.

Because many escrow companies do not usually accept faxed or emailed copies of signatures, using an authorized Power of Attorney will be your best bet.  Although, do make sure to get approval to use a Power of Attorney from your lender if applicable.  Also, make sure to notify your escrow company if you do plan to go out of town at the time of your close.

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Three Important Things About the Escrow Process That You Should Know

The escrow process can often times feel overwhelming to both first time buyers and those who have bought and sold real estate previously. Given the various stages of escrow, steps involved, and the terminology used, this extremely important process can cause even the most astute individual to feel a bit uneasy.

Obviously having a knowledgeable escrow officer on your team can make the process smooth, but we believe that educating yourself can also be helpful in better understanding what to plan for and expect.

The First Step: Opening Escrow

Opening escrow is the very first phase of the process. This period involves the collection of general information, including details about the parties involved in the transaction, stipulations that are relevant to the escrow and home price information. It is the escrow officer’s responsibility to ensure that all of this information has been collected. Once this is solidified, the escrow officer prepares instructions outlining the escrow moving forward. These directions are crucial to ensuring the escrow successfully closes.

The Second Step: Processing Escrow

Processing the escrow typically involves additional collection of information. The information collected in this phase differs slightly, as it involves details that are more granular and specific to moving the transaction into closing. Obtaining a preliminary Title Report, configuring the funds needed to proceed, and obtaining signatures are all items that are typically executed during this phase.

The Final Step: Closing Escrow

Closing escrow is the step that most homebuyers and sellers eagerly await. A crucial component of this step resides in completed all of the “to-dos” within a set timeframe. Your real estate agent and escrow officer should work closely together to ensure that these deadlines are met. Working with the Title Company, preparing statements, and paying off loans are things that normally take place during this stage. The escrow will successful close and the property will be transferred once all of the outlined instructions have been executed.

For more information about the escrow process, please feel free to contact us. We’d be more than happy to clarify any questions or concerns you might have!

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We Speak Your Language!

At Glen Oaks Escrow and our sister companies, American Trust Escrow and Coachella Valley Escrow, we speak many different languages.

We know our community is very diverse and understand the importance of making your clients feel comfortable during the escrow process.  We believe that delivering exceptional escrow service begins with our team!  Our escrow officers will work with one another to help translate in order to best accommodate you and your client.

If your client is foreign or local, and speaks any of the languages listed below, they can be confident their escrow will be managed professionally and expeditiously.  Please don’t hesitate to contact us today.

Armenian
Cantonese
English
Farsi
Japanese
Korean
Mandarin
Sign Language
Spanish
Tagalog
Vietnamese

Glen Oaks Escrow has been providing the highest standards of escrow services to southern California for nearly two decades.  We have now have offices located in Arizona and Nevada in addition to our two locations in Glendale and Valencia.

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Notice of Right to Cancel: An Explanation for Borrowers

One of the common documents a borrower may encounter in escrow is the “Notice of Right to Cancel.” This document is also referred to as the “rescission document” or the “3-day Notice of Cancellation.” This notice will be found in the loan document package, and it states that the borrower can cancel or rescind their loan transaction within three business days after signing the loan documents. Confusion arises for borrowers as to when the right to cancel applies, and if so, exactly what day the borrower can rescind their approval of the loan transaction.

When does the right to cancel apply?
The right to cancel applies to refinances or “home equity lines of credit” extended on a borrower’s “primary residence.” The right to cancel does not apply to borrowers who are purchasing a home, borrowers who are refinancing their second home, or on investment or rental properties.

Understanding the important dates on the document.
There are two important dates on the document. The first is the date of signing. The second is the rescission date, or final date to cancel. When the lender prepares final loan documents for an anticipated signing, he may indicate these dates by printing them in advance for the borrower on the Notice of Right to Cancel. However, many lenders prefer to leave the dates blank on the document because the exact date of signing may not be known. In this case, the lender may print instructions on the document for determining the correct dates, or the lender may insert an instruction sheet into the loan package with the Notice of Right to Cancel. If the dates are already printed on the document in advance, but are incorrect, the instructions will provide information on how to properly correct, or how to properly interpret the dates to determine the rescission date.

Determining the rescission date.
The borrower has the right to cancel until midnight on the third day after signing. To determine the correct rescission date after signing, the borrower or his qualified escrow and loan document-signing agent (Notary Public) will count three days beginning with the first day following the signing date (the transaction date is not counted). Sundays and legal federal holidays are not counted, and are therefore skipped. Saturdays are counted because banks conduct lending business on this day. To help with the determination of the correct rescission date, free “rescission calendars” are available and can be found via the Internet.

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Happy St. Patrick’s Day from Glen Oaks Escrow

Each petal on the shamrock brings a wish your way -
For good health, good luck, and much happiness
Today and every day. ~ Author Unknown

We are so lucky to have such a loyal following on the Glen Oaks Escrow blog.  We thank you for your continued readership and the feedback you provide.  All of us at Glen Oaks Escrow wish you a very Happy St. Patrick’s Day!

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New California Real Estate Laws – Part 2

Several new laws affecting the real estate industry became effective this year. In a previous post, we discussed SB 1149: Foreclosure Protection for Tenants, where a landlord is prohibited from harming a tenant’s credit score by revealing unlawful detainer records, unless the landlord prevails in court, and AB 1809: Energy Efficiency Audit in Home Inspection Report, where a home inspection and inspection report may include a Home Energy Rating System (HERS) home energy efficiency audit if requested by a client.

In this series of posts, we will highlight and give an overview of the other laws that also went into effect in January.

Adverse Possession Claim Requires Timely Payments
For a claim of adverse possession, existing law requires proof that taxes have been paid on the property for a five-year period. Effective January 1, 2011, Assembly Bill 1684 will further require that all state, county, or municipal taxes have been certifiably paid in a timely manner for the five-year period the property has been occupied and claimed. Read More

MLO Requirements
Effective January 1, 2011, Senate Bill 1137 requires those who act as a mortgage loan originator (MLO) to hold a MLO license endorsement issued by the Department of Real Estate (DRE) in order to be employed or compensated by a real estate broker. Those who act or advertise themselves as an MLO without a DRE MLO endorsement are guilty of a crime punishable by a $20,000 fine, six months imprisonment, or both. Corporations acting as an MLO without the endorsement by the DRE are punishable by a fine of $60,000. Read More

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New California Real Estate Laws – Part 1

Several new laws affecting the real estate industry became effective this year. In a previous post, we discussed SB 931: Short Sale Deficiency Protection for Sellers, in which lenders who have agreed to a short sale will not have the ability to obtain a deficiency judgment against the seller after the short sale is completed (applying only to first mortgage loans).

In this series of posts, we will highlight and give an overview of the other laws that also went into effect in January.

Foreclosure Protection for Tenants:
Senate Bill 1149 states that tenants that remain in a property after is has been foreclosed must be provided a notice of their statutory rights for one year, and must be explained in a separate cover sheet or included in a 90-day termination notice. This law also prohibits a landlord from harming a tenant’s credit score by revealing unlawful detainer records, unless the landlord prevails in court. Read More

Energy Efficiency Audit in Home Inspection Report
Effective January 1, 2011, a home inspection and inspection report may include a Home Energy Rating System (HERS) home energy efficiency audit if requested by a client. The inspection may be performed by a home inspector who meets the HERS regulations requirements. REALTORS are encouraged to provide the HERS booklet that explains the statewide HERS program to residential buyers. Read More

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Buyer Beware: Grant Deed Mail Scam

New scams are popping up everywhere these days. Emails about winning money, theft of personal information, and insurance scams have unfortunately become present in daily news or conversation. It is important for everyone to be aware of these scamming tactics and to learn how to identify them, especially because these extortionists have their eyes set on new home buyers. Today, we want to warn you about the latest scam that may be in your mailbox.

How it works:
- You receive an official letter in the mail from what seems to be a legitimate company.
- You are asked to pay anywhere from $50-$250, or even more, for a certified copy of your Grant Deed.
- The letter conveys a scare tactic message. For example, it may state that the Grant Deed is needed to “protect your purchase from foreclosure in today’s market”.
- The letter states that they will take care of sending a certified copy of your Grant Deed to you after they receive your payment.

Click here to see an example.
Click here for a second example.

Never send your money to a third party company to receive a copy of your Grant Deed.
There are other affordable options readily available. The Los Angeles County Recorder charges $6 for the first page, and $3 for every additional page. Each county is different, so please remember to contact the county where your property is located. Another helpful option is to speak with your escrow officer directly. Your escrow officer can get a copy of your grant deed for free. The document does not need to be certified to show that you are the rightful owner of your home; the Owner’s Title Policy will suffice. In addition, check your past mail. After closing your purchase transaction; the county recorder mails the buyers the original Grant Deed.

In the end, save your money and throw away the scam letter.

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The Preliminary Change of Ownership Report: An Explanation for Buyers

In every purchase/sale of Real Estate, a Preliminary Change of Ownership Report (PCOR) must be filed. The PCOR must be filed for other types of transfers as well, but in this blog we will consider only purchase/sale transactions. After opening escrow, a buyer can expect to find the PCOR in the opening document package.

What is the PCOR?

Ordinarily, at the time of transfer when sales of property are recorded via the grant deed with the county recorder, the grantee (buyer) fills out and files a PCOR. It is a two-page questionnaire requesting information on the property, principals involved in the transfer, type of transfer, purchase price, and terms of sale.

The PCOR normally satisfies the change of ownership reporting requirements unless the form is returned incomplete. The PCOR is to be completed, signed and certified by the buyer, as the buyer is signing the document under penalty of perjury. It is then filed in the county recorder’s office for the county where the property is located. The county assessor may also request other information about a deed or other matters related to the transfer after reviewing the PCOR. The PCOR is confidential and is not available for public inspection.

What is the purpose of the PCOR?

Each county assessor’s office reviews all recorded deeds for that county to determine which properties require reappraisal under the law. Once the county assessor has determined that a change of ownership has occurred, Proposition 13 requires the county assessor to reassess the property to its fair market value as of the date of ownership change. The PCOR is important to this process and it must be filed at the time of recording, otherwise an additional $20 recording fee will be assessed.

If the PCOR is not filed at the time of recording, the county assessor will send a Change of Ownership Statement (COS) to the transferee (buyer). If the COS is not filed by the transferee within 45 days of the county assessor’s request, then penalties can ultimately range from $100 to $2,500.

Understanding how to complete the PCOR

The section at the top of the first page of the document is used to identify the buyer (transferee) and seller (transferor), and the property being transferred. The information may be typed in the areas provided. Enter this information as it appears correctly on the grant deed. Be sure to enter the 10-digit Assessor’s Parcel Number (APN), which can be found in the title report provided by the escrow officer, and is also usually also found on the buyer’s purchase contract for the property. Also enter the mailing address to which property tax notices are to be sent.

Part I of the PCOR is used to provide transfer information, and it can be confusing. The assessor uses the information in this section to determine if the transfer may be excluded from reassessment. If a buyer has questions about Part I, the county assessor’s office can be contacted for assistance, or the buyer’s real estate agent or escrow officer may be consulted. Parts II, III, and IV of the document will help the county assessor better understand the nature of the transfer and the purchase price.

Finally, the buyer’s name must be printed at the end of the form, and the buyer must sign it to certify that the information provided is true and correct.

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Anti-Deficiency Protection for Short Sales

Senate Bill 931, providing California Short Sale Deficiency Protection, will go into effect on January 1, 2011.  This new law states that existing lenders of record who have approved and agreed upon a short sale will not be able to obtain a deficiency judgment against the seller after the short sale is completed.   After providing written consent to a short sale on a first mortgage or first deed of trust, the lender must accept the proceeds of the sale as full payment and must fully dismiss the remaining balance due on the loan.   This law applies only to first mortgage loans secured by one to four residential units.  However, this law would not apply if the lender is seeking damages for fraud or waste by the borrower.

Section 580e of the bill reads:

(a) No judgment shall be rendered for any deficiency under a note secured by a first deed of trust or first mortgage for a dwelling of not more than four units, in any case in which the trustor or mortgagor sells the dwelling for less than the remaining amount of the indebtedness due at the time of sale with the written consent of the holder of the first deed of trust or first mortgage. Written consent of the holder of the first deed of trust or first mortgage to that sale shall obligate that holder to accept the sale proceeds as full payment and to fully discharge the remaining amount of the indebtedness on the first deed of trust or first mortgage.

(b) If the trustor or mortgagor commits either fraud with respect to the sale of, or waste with respect to, the real property that secures the first deed of trust or first mortgage, this section shall not limit the ability of the holder of the first deed of trust or first mortgage to seek damages and use existing rights and remedies against the trustor or mortgagor or any third party for fraud or waste.

(c) This section shall not apply if the trustor or mortgagor is a corporation or political subdivision of the state.

The information in this blog is provided for informational purposes only. We recommend anyone going through a short sale or foreclosure to consult a licensed real estate attorney for advice.

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