Waiting for something to happen that is out of your control can be frustrating. You may have purchased a new home or are anxiously waiting to cash in your check from the sale of your home. Either one requires an escrow process to be completed. Many buyers and sellers do not fully understand what happens during escrow and the time involved. If you are waiting for the keys to your new home or are ready to get the moving van packed, these are a few things you should know.
What is the escrow process?
In summary, the escrow process represents all of the tasks that happen from when an initial contract is signed until the new deed on the property is executed. The time it takes to accomplish all required tasks can fluctuate depending on the amount of work and the resources available to do it. Each contingency written in the sales contract could require an expert review. Things like a home inspection or appraisal take a skilled resource to complete. If there are many homes being sold in a local market, these resources could be limited. The escrow process could take longer to complete. This is when the waiting game begins. It’s best to practice patience, but also remember it never hurts to stay on top of things.
Where does my deposit go?
When a buyer and seller agree to a price, there is often a deposit requirement. This deposit is meant to hold the home for the buyer while they and their lender complete their due diligence to ensure the home meets their requirements. It could sometimes be non-refundable if the seller requires it. This money, however, does not go into the seller’s personal account. Your Omaha title company opens an escrow account to hold the funds until the process is finalized. The money may be deposited via a cashier’s check or a wire transfer. This money will be applied to the final amount due during the final closing process.
What happens after the deposit is made?
The easy part of the process is signing the contract and getting the deposit down. Once you have that out of the way, it is time to coordinate the contract’s requirements. Your contract likely had contingencies like appraisals and home inspections. If it was a cash offer, these may not be required and will speed up the process. Each contingency must be reviewed, and work completed to satisfy the requirement. In addition to any contingencies, there is plenty of paperwork and research that your title company must do.
Lenders have their own requirements.
You may have received pre-approval from your bank for a fixed mortgage amount. This does not necessarily mean you can access all that money for a particular home. Lenders want to be sure the money they are lending you will be used wisely. They will want to know the house’s value and its current condition. This will require a series of things to be completed.
- Appraisal – A certified home appraiser will go to the property to determine the value. They will look at the home and the neighborhood to gather their requirements. Once they have the necessary information, they will compare similar homes to arrive at an appraised value. If unsatisfied with their numbers, you can also ask for a second, but you will likely have to pay for another appraisal.
- Inspection – Home inspectors go into the details of your home. They are experienced in all aspects of how a house works. Electrical, plumbing, heating/cooling systems, the roof, and the home’s overall integrity will be reviewed. They will release a detailed report that you, the lender, and the seller will review. This report may determine any adjustments in price or fixes that the seller must make to move forward with the deal.
- Title Search – You wouldn’t want to purchase a home that had liens against it or didn’t have an accurate deed. An Omaha title company will thoroughly search court records to ensure the property is free and clear of any issues. If there are issues, they will be identified and addressed with the seller or through further court research.
When do I get my money or the keys to my home?
The final step in the escrow process is to wrap everything up. This will include recording a new deed with the buyer’s information and transferring any money due into the escrow account. At closing, the buyer will get the keys to their new home, and the seller will receive a check or wire transfer for the final amount due to them. The escrow account will be closed once all transactions are completed.
Having the right title company will ensure your escrow process goes as smoothly as possible. Trustworthy Title has a team of experts to help you accomplish all requirements quickly and efficiently. Contact them today to get ready for your escrow process.