HOME BUYING GUIDE: WHAT IS ESCROW?

Escrow is a critical part of the home buying process, serving as a neutral third party that holds funds and documents until all deal conditions are met. It's like a careful juggler, ensuring everyone plays fair before the deal closes. In Sacramento, the escrow period typically lasts around 30 days, but can vary based on the lender's pace. Understanding the escrow process can help ensure a smooth journey to homeownership.

• 🔍 Escrow involves a third party holding funds or documents until conditions of the sale are met.
• 🚀 The typical escrow period in Sacramento is about 30 days but can be shorter if expedited by the lender.
• 💸 Buyers need to provide an earnest money deposit shortly after their offer is accepted.
• 🛠 Engage in inspections to negotiate repairs or credits, ensuring the property's condition meets expectations.
• 📜 Final property walkthrough ensures everything is as agreed before completing the purchase.
• 🔑 Successful escrow completion means receiving the keys to your new home!
• 💡 Stay informed, communicate effectively, and prepare financially to navigate escrow successfully.

Escrow is a safeguard in real estate transactions, acting as a neutral third-party service that holds funds and documents until all conditions in a real estate contract are met. This process ensures that both the buyer and seller fulfill their obligations before the transaction is finalized. In Sacramento, the escrow period typically lasts around 30 days for financed transactions, though some lenders might expedite this to as little as 17 to 21 days.

Learn more about escrow at First California Escrow or Neighborhood Escrow.

Once your offer is accepted on a home, several key steps unfold during escrow to ensure a smooth transaction:

• 1️⃣ Deliver Your Earnest Money Deposit: Within three days of offer acceptance, provide your earnest money deposit to the title company.
• 2️⃣ Review Disclosures & Reports: Receive and carefully review all seller disclosures and inspection reports.
• 3️⃣ Request for Repairs or Seller Credit: Based on inspection reports, negotiate repairs or credits from the seller through escrow.
• 4️⃣ Secure Homeowners Insurance: Finalize a homeowners insurance policy before closing.
• 5️⃣ Final Verification of Property Condition: Conduct a final walkthrough to verify repairs have been completed.
• 6️⃣ Escrow Signing Appointment: Attend your signing at the title company. Once documents are signed and funds transferred, the title company submits the file for county recording.
• 7️⃣ Receive Your Keys: Once the escrow is officially closed and recorded, you'll receive the keys to your new home.

Inspections let buyers uncover issues that could impact the property or insurance rates, enabling them to make informed decisions or negotiate terms effectively. Homeowner’s insurance, finalized before closing, ensures your investment is protected against unforeseen events. Rising premiums in California urge buyers to consider property updates that might reduce these costs.

• ⚡ Stay Informed: Understand each stage of the escrow process to avoid delays and surprises.
• ⚡ Communicate Effectively: Keep open communication lines with your lender, real estate agent, and title company.
• ⚡ Prepare Financially: Be ready to cover ongoing costs such as insurance premiums and potential repair expenses.
• ⚡ Use Technology Wisely: Leverage online document signing to streamline the process and keep transactions secure.