First, a little about "escrow". When you're closing on your new home, an escrow agent is used to make certain the process will close without problems and in a certain amount of time. A property is said to be in escrow when in the closing process, money is held by a third party on behalf of two parties (in this case, a buyer and a seller) when the exchange of money takes place. PayPal is a good example of an escrow company.
Tying up any loose ends like receiving funds, completing forms, securing the documents for loans and liens, and making sure you get a clean title to the property prior to your purchase gets finalized are all part of the job of the escrow agent.
These are the records that escrow holders usually look to collect:
- Requests for payment for various services to be paid out of escrow funds
- Loan documents
- Tax statements
- Fire and other insurance policies
- Title insurance policies
- Terms of sale and any seller-assisted financing
You're ready to close when all parts are complete in escrow process. At this time, all payments and fees for inspections, title insurance and real estate commissions are collected. The house's title is given to you and title insurance begins per the steps of your particular escrow agreement.
The escrow holder gets a payment when the closing is complete. You'll know when it's time to submit the form of payment.