Real Estate Escrow

What You Need to Know

“Being in escrow” is a legal procedure used when real property requires a transfer of title. An impartial third party, usually the title company, acts as a stakeholder and facilitator for both you and the seller to handle the property transaction, the exchange of money, and any related documents.

Normally occurring within one business day of acceptance of the purchase agreement, your initial deposit is held in an escrow account for a period of approximately one month until all the paperwork is completed and your title company records the title deed and loan deed of trust.

What is Escrow?


1. Property Inspections are typically conducted within 15 days of offer acceptance. Inspection fees are usually paid by you, but any costs associated with issues that surface, as specified in the contract, are negotiable with the seller.  You should attend all inspections to gain first-hand knowledge about your property.

2. Structural Pest Control Inspection by a licensed structural pest inspector examines the home for evidence of termites, dry rot, earth to wood contact, water intrusion and other infestations.

3. Contractor Inspection includes plumbing, heating and electrical; structural elements; roof; safety features and building code compliance.

4. Other Inspections as needed may include structural engineers, surveyors, and experts in soils, roofs, fireplaces, underground storage tanks and environmental hazards.

5. Final Loan Commitment occurs once the lender appraises the property, reviews the purchase contract, title report and other documents.

6. Home Warranty is purchased by either you or the seller to protect you against unknown defects and failures in systems and appliances.

7. Removal of Contingencies occurs once inspections are completed and you have received final loan approval.

8. Review and Sign Loan & Closing Documents is the final step in the escrow process. Be sure to bring your valid driver’s license or passport to the signing appointment.

Final Thoughts


  • The mortgage escrow process ensures that all parties meet their obligations before the transaction is completed. It’s for your protection.

  • Now it’s time to pick up the keys, roll up your sleeves, and move in!
  • Remember to keep important closing documents for administrative and tax purposes.
  • Let’s Connect. We’d Love to help.

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July 3, 2020

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