Understanding Escrow: Peace of Mind for Real Estate Transactions§
Escrow is a vital service in real estate transactions provided by a neutral third party to manage and secure funds until both the buyer’s broker and seller’s broker have fulfilled their contractual obligations. This structured process ensures that both parties meet all their responsibilities before completing the transaction.
Choosing an Escrow Company§
Typically, the seller’s broker selects the escrow company, though either broker can make this decision. Once chosen, the escrow company takes over as a meticulous overseer to guarantee all contract elements are realized. They ensure all monetary exchanges, including payments to banks, are conducted properly.
Safeguarding the Transaction§
The escrow company’s role is akin to a watchdog, guaranteeing protection for both buyer and seller until the deal is finalized. They confirm that all contractual requirements are met and, upon completion, transfer ownership by issuing the house keys to the new buyer.
Escrow Fees§
Fees for escrow services are typically added to the buyer’s real estate purchase agreement. These fees must be paid at the beginning of escrow involvement and are essential to secure the neutral oversight that benefits all parties involved.
Final Thoughts§
Utilizing an escrow service brings peace of mind by ensuring every step in a real estate transaction is thoroughly checked and double-checked. Both buyers and sellers can rest assured that their best interests are protected until the very end.
Related Terms: Escrow Account, Escrow Agent, Real Estate Broker, Real Estate Title, Closing Costs.
