Congrats! You Made It To Escrow! Now What?
Your offer has been accepted – congratulations! You’re ready to settle into your dream home and enjoy a glass of wine. The only thing standing between you and the keys to your new home is escrow, so now what? You’ve probably heard the term escrow (also referred to as closing) thrown around but didn’t quite understand what it meant. Escrow is something most people don’t fully understand until they experience it. In a nutshell, they are your neutral third party assisting to ensure the contract is executed correctly by all sides.
The Orange County Escrow Process Made Easy
Escrow protects all parties involved in the real estate transaction (including you)! Escrow is a third party service that holds a valuable asset (in this case – your “earnest” money) until the transaction between the seller and the buyer is complete. Once your offer is accepted, an escrow company is hired to implement the transaction in accordance with the terms of the sales agreement.
Does A Home Buyer or Seller Choose Escrow?
Not all Escrow companies are created equal and we always prefer to work with companies we know and trust. That said, it’s our advice to negotiate price over services. If you are a buyer, you may get the seller to accept your offer or your price if you let them choose the escrow company. In most Orange County and SoCal cases, the seller selects the escrow and title companies used for closing.
What Happens Next? How Do We Close Escrow?
It’s a series of steps in a specific order of operations. Your escrow, title, and lender will know it all and help guide you through. As your Realtor, it’s our job to make sure they are all doing theirs. Sometimes it feels like a circus and sometimes it feels like a symphony. Rather than writing you a book, here’s a fun graphic thanks to Finance Of America Mortgage to guide you through the main hurdles, contingencies and objections to overcome!
5 Tips To Make Your Escrow Process Run Smoothly
1. Let Your Lender Lead The Way!
You’ll need to sign loan disclosures before an appraisal can be ordered, so do everything your lender requests and do it promptly. This is the BEST way to have a smooth escrow.
2. Complete Documentation
The purchase agreement must be completed with signatures from all parties. The Escrow officer will send a package of paperwork, make sure to be on the lookout for this paperwork and complete it promptly. Signing documents online will help you stay organized.
3. Sign On Time
The purchasing of a home will require a significant amount of paperwork and legal documents. It is important that all of this paperwork is signed and in a timely manner to ensure that the sale may proceed without any delays. The escrow officer will take possession of these documents to ensure that all necessary paperwork has been completed, signed, and filed on time.
4. Communicate!
Check your email regularly! Your escrow officer will be reaching out to all parties involved frequently! Your escrow officer might need a signature sent over in a timely manner.
5. Halt Credit Utilization – You’re In A Financial Fishbowl
During the closing process, your financial history is being reviewed carefully and frequently. A change in your financial circumstances could implode the escrow process. You have made it this far based on your current financial standing – if changes occur lenders have the right the always make drastic changes.
Learn about what to avoid when closing on a mortgage here:
3 Ways To Mess Up Closing
If you are ready to get your escrow process stated, contact Angie Weeks at 949-338-7408!
Read Full Post | Make a Comment ( None so far )TRID – What Consumers Need to Know
TRID is the TILA / RESPA Integrated Disclosure Rule which is designed to help consumers understand the mortgage and real estate buying process more thoroughly.
How to most industry people see it? TRID is dirt spelled backwards 🙂 It’s a pretty big change and it’s causing delays. We’re annoyed.
45 is the new 30. That’s what everyone’s saying about an escrow timeline. In order to close in 30 days, everything has to flow perfectly. Now be honest, how often does that happen???
In this perfect world…Escrow needs to get the fee sheet over the day the lender requests it.
Furthermore, disclosures need to go out immediately, and the appraisal needs to be ordered pronto. Before loan docs, well pretty much before anything, a CD (Closing Disclosure) needs to get out to the borrower. The best lenders right now are providing this digitally, and those who aren’t (*ahem* B of A, Chase, Wells) have a closing timeframe of 60+ days, which is completely unacceptable. Every time something big changes, a new Closing Disclosure must go out and there is a 3 day mandatory waiting period. There’s no more room for sloppy documents and slow turnaround for paperwork. Having a good real estate team (title, escrow, lender, and Realtor) who all communicate is crucial more than ever with these TRID guidelines.
Delays can be caused by any one or more of these simple elements within the escrow process:
- HOA dues
- HOA transfer fees
- HOA move in/out fee
- Sewer lateral
- Roof inspection
- Pest inspection
- Security deposit transfers
- Insurance Certification costs
- Prorated rents
- Seller rent backs
- Mobile signing fees
- POA preparation fees
- Subordination prep fees
- Draw deed fees
- Buyer paid Realtor commission
- Repair credits
- Carbon monoxide detectors missing
Inspections should be done as soon as possible to avoid any of the above issues. Changing lenders in the middle of the deal now undoes the entire timeline and forces everyone to start over. You need to interview your lenders and have your team in place BEFORE escrow starts. Call us if you need referrals for competent lenders here in Orange County.
If you’re already in escrow with another team, make sure your agent orders Home Warrantee, all disclosures and inspections right away, and is in good touch with the lender. These are all standard practice already with the AskAngie team.
As a seller, you can help too. Right when you open escrow, call the management company right away with the credit card info and order your HOA documents. They are famously one of the slowest moving parts of an escrow so it should be addressed on day 1.
If you have any comments or questions about working with the new normal and TRID, don’t hesitate to call 949-338-7408, comment below, or tweet @AngieWeeks !
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Orange County Real Estate Success 