For Buyers

Six Steps to Home Ownership
Step 5: From Contract to Close

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Step 5: From Contract To Close

Most people mistakenly believe an agent’s job is done when the contract is accepted. It is from contract to close that is most vital. It is during this phase that is most important to have a strong team working towards a successful close. Title searches, building inspections, pest inspections, loan applications and underwriting, repair requests and many other details must be handled in specific timeframes to ensure a successful close. It’s the professional handling of this step that can make all the difference.

It is this phase when you're considered "in escrow". So what is escrow? An escrow is a deposit of funds, a deed or other instrument by one party for the delivery to another party upon completion of a specific condition or event. It is an independent neutral account by which the interests of all parties to the transaction are protected. What that means is, your escrow officer is an independent “stakeholder” to the transaction ensuring the interests of all parties are protected.

The escrow officer can hold inspection reports and bills for work performed as required by the purchase agreement. They oversee the details of the contract, including hazard insurance, title insurance, and deed transfer. They are often charged with making sure that all aspects of the contract are carried out, the all monies are received and delivered as required and that the transaction occurs as contractually specified.

Your escrow officer will:
  • Prepare a title report showing condition of the title prior to the sale or loan
  • Issue a title insurance policy against loss resulting from defects of title
  • Ensure that existing loans and liens are paid off
  • Prorate taxes and insurance upon instructions from the buyer and seller
  • Arrange an accounting of all funds
  • Oversee document signings
  • Record appropriate documents with the county
  • Disburse funds as specified
Step 6 - The Close and the Move  



who Pays What
TYPICAL BUYER CLOSING COSTS
  • Title and escrow fees: fees for the title search, document preparation, recording and notary fees, courier fees, flood certifications, etc. (50%)
  • The buyer will pay for a title insurance policy for the lender
  • Costs associated with the loan
  • Home owner association transfer fees
  • Interest on new loan from day of funding to 30 days prior to first payment
  • Hazard insurance premium (home owners insurance) – the first year’s premium is paid up front. You may also be required to place a certain amount into an impound account so that next year’s bill can be paid by the lender
  • Termite, pest and other inspections
  • Prepaid Home Owner’s Association fees or capitalization costs.
  • Agreements per the contract

TYPICAL SELLER CLOSING COSTS
  • Title and escrow fees: fees for the title search, document preparation, recording and notary fees, courier fees, flood certifications, etc. (50%)
  • The seller will pay for a title insurance policy for the buyer
  • Real estate agent fees
  • Home Owner Association transfer fees
  • Payoff of all loans and debts on the property
  • Home warranty
  • Prorated unpaid taxes as well as any unpaid HOA fees
  • Seller concessions towards buyer’s costs (if negotiated as part of the contract)
  • Requested repair costs
  • Agreements per the contract

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