First, a little about "escrow". To finalize the sale of a home, a neutral, third party (the escrow agent) is engaged to assure the transaction will close perfectly and on time. When funds are held by a third party in a transaction between a buyer and a seller, it's in escrow. PayPal is a good example of an escrow company.
The escrow company insures that all terms and conditions of the seller's and buyer's agreement are performed prior to the sale being completed. This includes securing monies and paperwork, finishing required forms, and seeking out the release documents for any loans or liens that have been paid off with the transaction, assuring you have a free title to your property before the final price is fully paid.
These are the legal documents that escrow companies usually look to collect:
- Fire and other insurance policies
- Title insurance policies
- Terms of sale and any seller-assisted financing
- Requests for payment for various services to be paid out of escrow funds
- Loan documents
- Tax statements
Upon completion of all portions of the escrow, closing can take place. All outstanding payments and fees are collected and paid at this time (covering expenses such as title insurance, inspections, real estate commissions). Title to the home is then given to you as new homeowner and related title insurance is issued as outlined in the escrow instructions.
At the close of escrow, in an acceptable form to the escrow. I'll keep you updated on the next steps.