What is Escrow?

I can count numerous times where I have been asked, what is escrow? Escrow by definition is a bond, deed, or document held in custody by a third party taking effect once a specific condition is filled. In this case, once your offer on a new home or other property is accepted by the seller, your transaction is placed into escrow. This means the buyer will deposit funds, a deed, and or any other items to a third party for the purpose of completing the transaction.

Why do I need it?

Escrow is needed for numerous reasons. Escrow provides assurance that no funds or property will change hands until the completion of the transaction. It also facilitates the real estate transaction by managing the disbursement of funds and documents. If the buyer decided to back out of the deal they can possibly lose their escrow money. Once the deal is complete the escrow money is returned to the buyer.

Who keeps the escrow money?

The escrow money is held by the escrow officer. The officer will be provided with documents from the buyer, seller, and lender to close the transaction. The officer is responsible for following the instructions set forth by the members in the transaction as well as processing the escrow in a quick efficient manner.

Closing the escrow?

Certain terms must be met for the closing of the escrow. First the home inspection must be completed. Both parties must come to an agreement regarding the inspection and negotiated repairs must be made. The purchasing of homeowners insurance is another term that may have to be met. This is followed by disbursing fund and providing the closing or settlement statement.

If you are someone you know is looking to buy or sell a home I would be happy to help! Thanks again for reading my blog!

Elaina Musleh

Bif Ward Real Estate Group

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Direct Cell: (317) 650-5898

ermusleh@gmail.com