Pathway General FAQs
Escrow is a service which provides the public with a means of protection in the handling of funds and/or documents. Escrow enables the buyer and seller to transact business with each other through a neutral third party, thereby minimizing their risk. In the escrow, all parties involved give their instructions to this neutral intermediary, the “escrow holder” whose duty it is to assure that no funds or property will change hands until all instructions have been carried out to completion.
Most contracts involve the transfer, lease or financing of real or personal property can be placed in escrow. You may be involved in escrow not only when you buy or sell a home, but also when you buy or sell a mobile home, sell a business or transfer stock in a closely held business. Prizefighters have been known to have their purses guaranteed through an escrow depository. The buyer or seller should demand the protection of escrow for any transaction which involves a substantial investment.
The escrow officer and staff are trained and experiences professionals. He or she can provide you with the assistance required to close your transaction quickly and effectively. This professional person may, under the terms of the instructions, make the decision that the conditions of escrow have been met, and then order the transfer of the real or personal property to the interested parties. Many escrow officers proudly display their professional designations of certification and show these designations on their business cards and letterhead. The designations indicate that this person has met the high standards of education and experience required for certification by the California Escrow Association.
An escrow officer is not a legal counselor and cannot give you advice. Remember, the purpose of escrow is to take, and comply with, instructions to carry out the mutual agreement of the principals. In the event of a disagreement of the parties, the escrow officer must remain neutral until agreement has been reached. The transaction should not be negotiated in the escrow office, nor should an escrow officer become involved in the negotiation.
If negotiations have been conducted through a real estate agent, that person, or his/her broker, should be your primary consultant. The role as an independent agent prohibits the escrow officer from answering many of your questions. However, a knowledgeable escrow officer, whose responsibility is giving impartial service to all parties, will refer you to the proper source for your answers. An escrow officer will often suggest that the customer seek the advice of legal counsel or a tax consultant.
The amount of funds requested from the buyer for closing is based on the most current information available to escrow at the time the file is figured. If the closing date changes or fees are revised, the Escrow officer must have sufficient funds in the escrow to make adjustments and to pay all of the actual settlement costs at closing. Therefore, a pad or cushion is always included in the estimates to allow for any necessary adjustments.
When escrow has determined that all terms and conditions of the transaction have been met, buyer will be requested to WIRE TRANSFER the balance of the down payment and any remaining closing costs directly to either the escrow or title company. All closing funds need to be received no later than 48 hours prior to the closing date.
The buyer will have signed all necessary documents at the time when they met with the notary public and signed their loan documents. Escrow will, however, contact the seller just prior to closing for signatures on any final documents necessary including but not limited to: any lender =required forms, a final settlement statement and a final authorization to close.
One of the most common questions we get regarding the day of closing is “do we need to present?” Unlike other states, your closing in California does not require your presence the date the documents are recorded and the escrow is closed. Escrow will have communicated with the title company regarding their authorization to record the documents. Once the title company has received confirmation from the County Recorder’s office that the documents have been recorded, escrow will be notified, and escrow will notify the broker/agents and oftentimes the buyer and seller as well.
Both buyer and seller will need to provide mutual, written instructions to the escrow holder as to the disposition of the funds on deposit. Once agreed, the funds will be disbursed, less any fees if applicable. In the absence of mutually agreed upon instructions, the funds will remain in the escrow trust account pending Court action or interpleader.
Pathway Buyer’s FAQs
Fees and charges are controlled by many factors and depend largely upon the type of transaction and terms of your agreement. However, there are certain charges which are considered to be normal. Those fees include but are not limited to: new lender charges,Loan document signing fee, buyer’s portion of the escrow fees, Lenders title insurance policy, sub-escrow fee, recording fees, annual fire insurance premium if applicable, prorated property taxes if applicable. Any other fees pursuant to your specific contract may apply. Upon receipt of the estimated settlement statement, review it carefully and call escrow with any questions.
Yes, a personal check is acceptable and should be deposited with escrow within 3 business days of date of acceptance on the contract. That check will be cashed and placed in the escrow trust account until the date of closing.
No, a personal check is not acceptable at that time. Pursuant to the Good Funds Law, escrow must be in receipt of “good funds” at least 48 hours prior to closing and is typically requested in the form of wired funds. Should buyer’s funds need to be tendered in the form of a cashier’s check, please contact escrow for further direction.
The buyer should research insurance options early in the transaction by contacting different insurance agencies for quotes. The lender will require that they be provided with Evidence of Insurance prior to closing and the first years premium must be paid either prior to or at closing. Once the buyer has agreed on a policy, contact escrow with the insurance contact information. If the purchase involves a townhome or condominium, there may still be insurance requirements above and beyond what the Homeowners Association covers.
The loan documents will be reviewed carefully by escrow for accuracy. The escrow settlement statements and all necessary final documents are then prepared. Buyer will be contacted to schedule a signing with the Notary Public, which signing may be in the escrow office or other location at buyer’s choosing. Buyer must present identification in a form acceptable to the Notary Public and name on the identification must closely match the name on the documents. Direct any questions regarding your identification to escrow as soon as possible. At the time of signing, buyer will be provided with an estimated settlement statement and wire instructions for the final closing funds.
The closing date is established by the parties and stated in the purchase contract. Typically, the escrow will close 2-3 days after the lender has received the signed loan documents. During this time, the documents are being reviewed by the Lender and the loan funding is scheduled. The Escrow Officer will work closely with the Lender to coordinate the scheduling of these final details.
When the Escrow Officer confirms that the recording is complete, the Real Estate Agents are notified and the keys can be provided to the Buyer by the Agent. Escrow may be in possession of any Homeowners Association common area “keys, cards, fobs, remotes, etc.” , which will be given to the buyer or buyer’s agent at closing (only if required by the Association Management).
Pathway Seller’s FAQs
Fees and charges are controlled by many factors and depend largely upon the type of transaction and terms of your agreement. However, there are certain charges which are considered to be normal. Those fees include but are not loimited to: fees associated with payoff of your mortgage(s), Owners Policy of Title Insurance, City/County Transfer tax, applicable recording fees, seller’s portion of the escrow fees, pest inspection, Natural Hazard Disclosure, Home Warranty if applicable and applicable prorated property taxes. Any other fees pursuant to your specific contract may apply. Upon receipt of the estimated settlement statement, review it carefully and call escrow with any questions.
If the property taxes are due while you are in escrow, please contact escrow holder for further instructions. Placing a personal check in the mail directly to the Tax Collector’s office may cause funds to be held from your proceeds at closing awaiting clearance of that check and/or posting by the County.
Once escrow has closed and your mortgage has been paid off, your lender will audit the impound account and refund any monies left remaining in that account directly to you. You are advised to contact your lender directly with your forwarding address which will help insure that you will receive those funds in a timely fashion. The excess funds in the impound account are not paid through escrow.
Your realtor will assist you with the turnover of all items to the buyer with the exception of HOA/Common Area items. If you are in possession of HOA/Common Area keys/remotes/fobs, contact either your management company or escrow officer for further instructions. Leaving such items in the home could result in unnecessary charges.
You may instruct the escrow company to either furnish a check to you, or wire transfer the funds directly into your bank account. Either way, your funds are generally available the next business day following closing.