How is Closing Escrow Different than the Closing Date?
Finalizing the sale of a Parkland home is one of the most exciting and fun events in life, but it can also be a little nerve-racking with all of the details and requirements, and paperwork. Though the purchase of a new home is very exciting the process of getting from offer to ownership can be a little overwhelming.
With the help of an expert local agent on your side walking you through each step this process becomes a lot less scary and overwhelming. It is good to be knowledgeable about every step in your homebuying process. One of the steps that can become confusing for Parkland buyers is the escrow process.
There are many different aspects to escrow and one that sometimes gets overlooked and hardly explained is the close of escrow. Some people confuse it with the actual closing of the home sale but they are very different.
How the escrow process works
Escrow is a common part of purchasing a home but some people are unable to accurately describe what escrow really is. Escrow brings in a neutral third-party known as an escrow agent. This agent is responsible for keeping the earnest money in a separate safe account. The agent will ensure that earnest money is safely held as well as other important documents while due diligence and the rest of the closing process are being worked out. Once all of the due diligence process and contingencies have been carried out then the home gets ready to go into a final closing and escrow is closed.
More insight into the escrow closing process
Closing the escrow account and releasing all of the important paperwork being held by the escrow agent means that all of the requirements of the home purchase agreement have been successfully met and the total amount of money for the purchase price as well as the legal possession of the property are transferred to the proper buying and selling parties.
The closing process for escrow actually starts with the home buyer handing over their earnest money deposit to the escrow agent. This is a deposit made on the purchase of the home in good faith that they will follow through with the home purchase process. The escrow agent will then hold this in a neutral third-party account to later be transferred to the home-selling party. There is only one escrow officer per home purchase and they essentially become a middleman between both parties in the sales transaction to ensure that things run smoothly up until the official closing date.
How the closing of escrow differs from the closing date
They were often mixed up and confused and sometimes can actually happen on the same day but they are two different events in your home purchase process. The close of escrow can also happen on a different day depending upon if the home seller is present at the closing.
The escrow is when both the home seller and home buyer have fulfilled all the obligations of the contract to each other. This means that earnest money is supplied and that the title documents are given as well as keys and any other responsibilities written into the purchase contract. When every single item of the purchase contract is fulfilled then escrow is officially closed.
It is possible to close on the mortgage loan of a home and take possession of the title deed and keys (escrow closing tasks) on separate days. Essentially the closing of the home sale is when the mortgage loan has met a final approval with the lender and all of the paperwork is signed. This is how closing differs from escrow as escrow handles all of the other essentials of the home purchase.
Purchasing a home is no small task and often is the largest and most important purchase many people make in their life. It is vitally important to be highly knowledgeable of everything in your Parkland home purchase process.
For more information on available real estate for sale in Parkland Florida please contact us anytime.