Understanding how Escrow works – Wires of Energy, Oklahoma City, OK

The process of buying real estate for the first time can be intimidating. I can help. E-mail me at mark.middleton@wiresofenergy.com .

The Place is Almost Yours

Wires of Energy can walk you through closing -

First, a little about "escrow". A neutral, third party (known as the escrow holder or the escrow agent) is brought on to assure your place closes on time and the closing process goes smoothly. A home is said to be in escrow when in the closing transaction, payment is secured by a third party on behalf of two parties when the exchange of money takes place. For example, in an online auction, PayPal is the neutral third party that obtains the buyer's payment, and then sends the payment to the seller.

The escrow company makes sure that the terms and conditions of the agreement between the two parties are completed in preparation of the sale being finished.

The records the escrow holder may obtain include:

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

You're ready to close when every step is finished in escrow process. All expenses like title insurance, inspections and real estate commissions are paid. You'll then obtain the title to the home and the title insurance gets dispersed as stated in the escrow instructions.

The escrow agent receives a payment when the closing is complete. As your real estate agent, I'll inform you of the acceptable form of payment.

The Escrow Holder Will:

Prepare escrow instructions
Perform a title search
Meet the bank's guidelines as specified in the escrow agreement
Accept payments from the buyer
Prorate interest, insurance, tax and other payments according to instructions
Record deeds and other documents as instructed
Obtain title insurance policy
Close escrow when all terms of agreement of seller and buyer are complete
Disburse payments and finalize instructions

The Escrow Holder Will Not:

Tell you what's best - the escrow company stays at an impartial, third-party status
Give insight about the outcome of your taxes

The Escrow Holder Will:		The Escrow Holder Won't:
Write escrow guidelines Perform a title search Comply with the bank's guidelines as specified in the escrow agreement Intake funds from the buyer Prorate insurance, tax, interest and other payments according to guidelines Record deeds and other documents as instructed Obtain title insurance policy Close escrow when all terms of agreement of seller and buyer have been finished Disburse payments and finalize instructions		Offer advice - the escrow agent stays a neutral, third-party status Offer opinions about future tax estimations

Mortgage Escrow Account

Creating a Mortgage Escrow Account helps keep track of on-going expenses while there's a loan on your house. Generally, the Escrow Account is partially funded at closing and the home buyer makes on-going contributions through their monthly mortgage payment.

This is a quick run-down of the escrow process. Your particular methods will be different based on your lender and your escrow holder.

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