What's an escrow account, and why do I need it?
An escrow is a deposit of monies, a deed, or other instrument made by one party for delivery to another party after a condition or event is met. You want assurance that no funds or property will change hands until all of the instructions in the transaction have been fulfilled, whether you're the buyer, seller, lender, or borrower. The escrow holder is responsible for safeguarding the funds and only disbursing funds or conveying title after all requirements have been completed.
Which party chooses the escrow account?
Typically, the selection of the escrow holder is made by mutual agreement between the parties. If a real estate agent is involved in the transaction, the agent may suggest an escrow agent. However, the principals have the right to choose an escrow holder who is competent and familiar with the type of escrow at hand. There are rules prohibiting the payment of referral fees; as a result, consumers receive the best possible escrow services, uncompromised by a referral fee.
What fees and costs will be charged for the escrow account?
The fees charged by escrow holders are proportional to the costs of providing the service, the liability assumed, and the overhead expenses, which include a profit margin. Consequently, the fees will differ between companies and counties. Typically, the escrow holder will adhere to its minimal fee schedule, which may include additional fees based on the various aspects of your escrow. We can provide an estimate of the escrow fees and expenditures upon request.
What if I need to cancel the escrow account?
Although no escrow is initiated with the aim of being cancelled, there are times when a condition cannot be met or when the parties disagree throughout the escrow process. We plan for such a situation by including a note in the written or printed General Provisions. Normally, an escrow holder will hold the stance that no funds on deposit can be repaid unless the Principals sign mutual cancellation directives. There could be a cancellation fee.