You hired a Realtor to list your residence and/or represent your purchasing a new residence. Offer negotiated so now you have a signed contract to sell or purchase real estate. Now what? Most Realtors neglect to educate their clients what happens during the next several weeks/months of ESCROW time. An escrow company (determined by buyer/seller NOT the Realtor) will be doing the title work and following the signed CONTRACT terms and conditions. Of course, both parties have already set in writing what they have agreed to……so the escrow company must use the signed contract to complete the transaction.
Escrow companies need a legible copy of the COMPLETE contract. That means all addendums that are party to the original offer to purchase. Pre-closing forms go out to buyer/seller and must be returned ASAP. Information requested includes present lien holder contact information, how the buyer will take title to the property and where the buyer has applied for the new mortgage and All legal documents (from either party) that relate to a trust or corporate agreement are verification of legal authority to buy and/or sell real estate and confirms who has the authority to sign all legal documents in reference to this transaction.
Second step: Title examination is ordered. Ideally examiners need 5-7 days to complete this task. With these results a title commitment is prepared. This commitment verifies the seller is the legal owner and has the authority to sell, identifies the legal description of the property, identifies any conditions and requirements that must be cleared to pass on marketable title to the new buyer and a copy of the commitment is forwarded to the lender with any preliminary requirements including, but not limited to, a HUD 1 Settlement Statement and title fees.
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Third step: Survey is ordered, Deed is prepared (by Escrow company attorney or one hired by the seller), HOA/Condominium statements requested for monthly or annual fees and their status, plus any Point of Sale information/city requirements are gathered. Now the buyer’s lender determines when escrow will receive the buyers loan package. Lender must give the clear to close which means it can take 24 to 72 hours before the loan package is submitted to the escrow company. Escrow agent will then complete the HUD for resubmitting to the lender for final approval. When approved, buyer will then be notified of the amount of funds necessary to transfer title and closing appointments are scheduled.
Step four: Closing appointments are confirmed, funds must be paid via certified bank check or wired directly to Escrow company, some signed documents must go back to the lender for final approval, and on receipt of verification and proof of funds title transfer can happen. Documents are then taken to the local country court house for recording, Realtors are informed so we can contact our clients, and the Escrow agent disburses proceeds to the seller, commission to the Realtor’s and any excess funds are returned to the borrower.
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FINAL STEPS: Escrow company confirms title policies are prepared and disbursed! Seller vacates the property and Buyer receives the keys to their new home (as agreed to in signed Contract). Another WIN/WIN situation!
Questions? Contact me, I have 30+ years experience helping people purchase and sell real estate in the great state of Ohio and I will be happy to help you as well!
Carol Murphy
Keller Williams, Greater Cleveland West ~ Carol Murphy Team