Page 12 - CTT-CA Real Estate Foreign Buyer & Seller Guide_English

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How Does the Escrow Process Work?
The Lender (When applicable)
• Accepts the new loan application and other related documents from the Buy- er(s) and begins the qualification process.
• Orders and reviews the property appraisal, credit report, verification of em- ployment, verification of deposit(s), preliminary report and other related information.
• Submits the entire package to the loan committee and/or underwriters for ap- proval. When approved, loan conditions and title insurance requirements are established.
• Informs Buyer(s) of loan approval terms, commitment expiration date and provides a good faith estimate of the closing costs.
• Deposits the new loan documents and instructions with the escrow holder for Buyer’s approval and signature.
• Reviews and approves the executed loan package and coordinates the loan funding with the escrow officer.
The escrow holder acts in a limited fiduciary capacity for both principals within the authority of the escrow instructions. Escrow cannot be completed until the terms and conditions of the instructions have been satisfied and all parties have signed escrow documents. The escrow holder takes instructions based on the terms of the purchase agreement and the lender’s requirements.
Opening Escrow
The selection of the escrow holder is normally done by agreement between the principals to a transaction. Typically, the escrow is then opened by the real estate agent.
Escrow may be opened via telephone, email, website or in person, depending upon the preference of the real estate agent. An escrow file number is assigned and the appropriate information is entered into the computer. Upon issuance of the escrow file number, the escrow officer will order a Preliminary Title Report from the title department. Generally, the buyer deposits their earnest money with the escrow holder. Prior to the close of escrow the buyer deposits the balance of the funds re- quired and agreed upon by the principals with the escrow holder.