The Basic Steps Of Escrow Closing - My Point Of View
First of all, I want to disclose tha I am not a closing agent or that I never have worked as one or at a escrow/title company. The following basic escrow closing steps are my point of view as perceived them as a real estate agent. If someone reading this is a closing agent or have a first hand knowledge of the process and notice that I miss something feel free to chime in.
1. Once an offer/deal is put together the next step is to open escrow with the settlement/closing agent. Settlement agent is a neutral third party that will prepare documents to transfer the title from seller to buyer, a closing agent can be an attorney, escrow/title company.
2. The process of open escrow is basically taking the copy of a signed contract accompanied by an earnest money deposit to closing agent. Earnest money is a good faith deposit showing the seller that buyer(s) are serious about going through with purchase of the property.
3. Next the closing agent will order a title search and do a close examination of all legal documents related to the property to issue a title policy. Some of these legal documents includes property tax information, easements, restrictions and if applicable loan payoffs, surveys, maintenance fees, inspections reports and applicable insurance. Closing agent will also make sure all requirements stated on the purchase and sale agreement have been met.
4. After all legal documents are in order a preliminary title commitment is issued, the closing agent will prepare closing documents. Following required instructions from lender and agreed contract of buyers and Sellers, the closing agent will prepare loan documents and settlement statement. These documents will include the deed, mortgage and other required documents that need to be review and sign by both buyers and sellers.
5. After the signing has been completed, the closing agent will send signed documents to lender for review. If all documents are in order lender will send funds to closing agent to pay seller or prior lender and all parties who performed services related to the transaction. Once everyone is paid closing agent will record the new deed on buyer(s) name with the county.