What is Meant by Escrow Services?
When it comes to money – whether buying or selling – you want as much reassurance as possible that you have protection for the funds and for the item changing hands. In the case of large ticket items, it is advisable to place earnest money in escrow to safeguard the transaction. In essence, escrow is a secure holding agreement between two parties whereby money is placed into a special account and managed by a third party until all of the agreement terms have been satisfied by both parties.
Escrow is often required for the purchase of a home. Think about a home you want to purchase. If that home costs $500,000, a lump sum of 1% to 5% of that purchase price would need to be placed into escrow when the homeowner accepts your offer (from $5,000 to $25,000 in this case). This shows the seller that you are serious about buying the house. An outside party will provide the escrow services necessary to manage this money on behalf of the buyer and seller. This could take 30 days or longer before the closing process (title searches, home inspections, negotiations, paperwork, etc.) is completely finished. The escrow money will only be released when the deal is completely finalized. The escrow money can be applied to your down payment.
Many people hire a title company to manage the many details surrounding the purchase of property (all of the closing process items listed above – and much more!). Escrow services may or may not be offered by the title company. If not, you may need to hire a bank or another financial institution to provide this service. It’s important for the escrow company and the title company to have open lines of communication to ensure a smooth transfer of funds when the time is absolutely right.
Clear Title is a title company in Northwest Florida that offers both title services AND escrow under one roof. By trusting their team of experts with your money, you can rest assured that the escrow funds are used for the settlement and closing costs and released to the seller at the appropriate time.
The owner of Clear Title is Stephen R. Moorhead, a Board Certified Real Estate Attorney who is Board Certified in Real Estate Law. He fully understands the importance of secure escrow services and works hard to help clients streamline the homebuying process. In addition to offering escrow services for clients of Clear Title, he also offers escrow services for clients who do not use Clear Title for other closing services.
With 100s of years of combined experience, the team at Clear Title can help make homebuying and selling a smooth process. To schedule a meeting with our experts and explore our Pensacola title and escrow services, contact us today at (850) 202-8518 or visit ClearTitlenwfl.com.