First, a little about "escrow". An escrow company is used to assure your home closes on time and the transaction goes smoothly. When payment is held by a third party in a transaction between a buyer and a seller, it's in escrow. For example, in an online purchase, PayPal is the secure third party that obtains the buyer's money, and then sends the payment to the seller.
The escrow holder makes sure that all terms and conditions of the seller's and buyer's agreement are performed prior to the sale being finished. This includes receiving payments and certificates, filling out required forms, and getting the release documents for any loans or liens that were paid off with the transaction, assuring you have a clean title to your house before the purchase price is fully paid.
Escrow holders collect the following records:
- Title insurance policies
- Terms of sale and any seller-assisted financing
- Requests for payment for various services to be paid out of escrow funds
- Loan documents
- Tax statements
- Fire and other insurance policies
Closing on the property takes place when the steps of the escrow are done. At this time, all payments and dues for inspections, title insurance and real estate commissions are collected. Title to the property is then transferred to you as now current homeowner and correct title insurance is issued as outlined in the escrow instructions.
The escrow holder gets a payment when the closing is complete. As your REALTOR, I'll inform you of the acceptable way of paying.