Realestate-Ese - Carlsbad Buyers Ask:
What Does “Opening Escrow” Mean?
There are a number of exciting moments when purchasing a home, especially your first one.
Getting your pre-approval once you decide to buy (you ARE getting pre-approved, aren’t you?!) is an early one. It’s essential to know what you an afford, including your personal budget.
Then comes the day when you find the home you fall in love with and decide to make an offer. Waiting for the response from the seller is always a nail-biting moment, but then you get the word that you have an accepted contract.
And somewhere along the way you hear about “opening escrow!” So what does this mean?
Before moving ahead you might want to read this post about escrow here in California so you understand a bit more about how an escrow company works and what they do during your transaction. Things are done differently from state to state. Check out this video series on how to buy a home and all the important things you should know!
I’m speaking from the perspective of a busy Carlsbad Realtor and not the escrow company, but essentially the opening of escrow is initiated by the listing agent, with the escrow company of choice (it might be either your choice, or more commonly in our area the choice of the seller but it depends on what is negotiated).
The Listing agent provides a copy of the executed Residential Purchase Agreement (RPA) – your offer - so that the escrow officer can set up an official account/file for the transaction to begin tracking all the documents, and create the escrow instructions from the RPA.
The escrow officer will provide your agent with an escrow number which identifies the specific file for tracking purposes.
The escrow officer will also provide the wiring instructions – the bank, bank account # the escrow #, address – so that you can wire your deposit (a.k.a. earnest money or EMD) within the time frame specific in the contract (normally within 3 business days after acceptance). Alternatively you might elect to take in a cashier’s or personal check but wiring is usually faster and more secure. NOTE - because of increasing scams, VERIFY the wiring instructions with the escrow officer over the phone before wiring.
Opening escrow can happen pretty quickly, and soon after the contract is signed, although it might not be until the morning of the first business date following the acceptance.
A number of important things happen once escrow is opened and I provide an Opening Escrow Checklist to my buyer clients so they know what to expect, in addition to having a discussion about what will follow.
If I can help you think through your home buying requirements, and your wish list, in light of your budget and other factors, and answer any questions about the home buying process, please give me a call at (760) 840-1360. Then we’ll get started on finding you the right home and get you into escrow in 2017!