For some, the escrow process can be perceived as confusing, perhaps even overwhelming at times. Buyers and sellers are dealing with deadlines, mounds of paperwork, and signatures galore. It is not uncommon to feel anxious and have questions during the process. As the neutral third party at the center of the transaction, escrow’s goal is to facilitate the transfer of property from the seller to the buyer. To help give buyers and sellers a better understanding of the entire process, we put together a Life of an Escrow overview flowchart.
As the chart illustrates, the escrow company is the neutral third party that facilitates the closing process when real estate is purchased or sold. Escrow is involved in many of the details regarding the purchase or sale transaction. It is common for there to be myriad of details, and escrow works with many different parties, such as a title company, mortgage banker, seller’s agent, etc., during the escrow process. It is important to also understand that escrow holds the money associated with the transaction until the requirements of the contract are accurately completed. Once escrow has facilitated the completion of the legal and contractual items, the transaction is recorded at the county and the buyer becomes the new legal owner of the property.
There are many details buyers and sellers should become aware of to facilitate a smooth escrow process. Many of these details are items we discuss on our blog in an effort to help demystify this complicated process. The chart above serves as the foundation for most transactions and can be used as a basis for further discussion or questions you may have with your escrow officer.