The Escrow Process In Palm Springs
In California, during the final stage of a home sale or a home purchase, buyers and sellers will encounter the escrow process. If you're a first-time buyer, you may not be familiar with this process and how it works. Even if you've encountered the escrow process before, it differs from state to state. Here is some basic information about the escrow process in Palm Spring and how that may affect you as a buyer or seller.
What is the escrow process?
The escrow process is the most common way in which real estate is purchased or sold in California. Simply put, the escrow process is the time between when the seller accepts an offer and the buyer takes possession of the home. Between those two points in time, there is a number of things that need to occur, including home inspections, mortgage approval, and a substantial amount of paperwork that outlines the exact terms of the home sale. The escrow process involves the buyer, seller, their respective agents, the escrow agent, and a title company. The escrow agent is a licensed third-party who acts as a middle man between buyer and seller. They hold funds, manage paperwork, and minimize risk for both parties.
Is the escrow process different in California?
There are differences between how that process functions from state to state, and even within California, there is a difference in how the process is managed in the north end of the state compared to the south end. In Southern California, you'll find that the escrow process involves both an escrow company and a title company whereas in the north only an escrow company is required.
In California, an escrow agent can either be part of:
- A corporation that specializes in escrow services
- A bank, mortgage broker, or insurance company
- A title company licensed by the California Insurance Commissioner
- Any involved real estate broker licensed by the California Bureau of Real Estate
How can the escrow process help me?
Imagine you decide you'd like to purchase a Palm Springs home for sale. You contact the seller, and they accept your offer. You give them a sum of money, known as "earnest money" as a show of good faith while you get your down payment together. However, after the seller has taken your money, another buyer comes in and offers the seller a much larger sum for their house and they opt to take their offer instead. In that case, it's up to the seller to give you your money back. When you have an escrow agent, they will act as an impartial intermediary who will hold funds and keep contracts until all of the details are resolved and the deal is ready to go through. In many cases, this minimizes the risk for both parties.
As a buyer what do I need to do in the escrow process?
As a home buyer, your duties in the escrow process include:
- Submitting "earnest money" deposit
- Providing escrow agent with information about who the new title will belong to
- Obtaining financial backing from lender, if necessary
- Approving finding of home inspection
- Signing documentation
- Delivering the full down payment to seller to close the escrow
As a seller what do I need to do in the escrow process?
As a seller, there are a few things you need to do to close escrow on your Palm Springs home for sale. These include:
- Providing the escrow agent with the deed to the home
- Revealing information about previous damage or potential problems with the home
- Conducting home inspections as requested
- Approving and signing escrow instructions and other documentation
- Fulfilling any conditions agreed upon by both parties
For more information about the details of the escrow process in Palm Springs, connect with me. As an experienced Palm Springs real estate agent, I can advise you on the stages of the process and ensure a successful real estate transaction.