Do you have a specific title or escrow/settlement company that you prefer to use? If so, be sure to let your REALTOR® know. Most buyers will defer to their agent’s recommendation of an escrow company with whom she has developed a good working relationship. In some states, the escrow/settlement company is known as a settlement company. In other states, an attorney’s office handles all the closing funds and paperwork, instead of an escrow/settlement company.
Your REALTOR® may recommend that you use the seller’s choice of escrow/settlement and title company. The seller may have already started a file at an escrow company; for example, if the property has already been in escrow with another buyer. If it is a short sale, then chances are that they have already been working with an escrow company they would prefer to continue using. If you are buying a brand new house from a developer, the seller will require you to use their escrow company because they have already negotiated a contract with them. If the property is an REO, meaning that it is owned by a bank, then the buyer is obligated to use the bank’s preferred escrow company.
This is where you will look to your REALTOR® for advice. He is experienced in dealing with these issues and will be able to write up the contract in the manner that is best for you, your agent will ensure that your offer is as competitive as possible.
If you want to view a list of each state and their typical closing procedures, take a look at the “State-by-State Guide to Real Estate Closing Practices in the U.S.” which is Appendix B in Gadow’s book, The Complete Guide to Your Real Estate Closing: Answers to All Your Questions - From Opening Escrow, to Negotiating Fees, to Signing the Closing Papers. This list is an excellent reference if you are unfamiliar with a state’s legal and customary procedures for closing.
Read more in our book, "Buy Your First Home", http://tinyurl.com/dy2wjx4.
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