How Escrow Works in Prescott Arizona

Escrow Closing Procedures

Here is what is about to happen once the Buyer’s loan is approved by the underwriter:

• Loan documents are sent from lender to escrow company(title company)
• Obtain your closing funds (remaining down payment and title and escrow fees) in the form of a certified check made out to the escrow company or wire them in (instructions on wiring are available from the escrow officer)
• You sign documents at the escrow company and deliver the certified funds
• Docs are sent back to the lender for review and approval
• Lender wires funds to escrow(wiring can take 3-4 hours and might have an overnight delay depending on the time the wire is ordered by the lender)
• Escrow drives the original copy of the Deed to the county recorder’s office and records the transaction. THAT IS WHEN YOU OFFICIALLY OWN THE PROPERTY.
• Escrow calls agents and Buyer and Seller to notify them that it has recorded.
• The Buyer get the keys.

Sometimes, just before recording, the title insurer may call for a reexamination of the title which could stop the recording. A recent transaction was to close on a Friday. A half hour before recording it was stopped by the title officer for review. Additional requirements were added that the Seller had to agree to and sign. It did not record until Tuesday late in the day, a full four days late!

Buyer’s responsibility:

• Most importantly do not buy anything on credit! The lender will check your credit right before wiring the loan funds to be sure your credit remains solid enough for the loan program you are in and there is no downward change in your score.
• Deliver certified funds to escrow at least 3 full days before the close of escrow.
• Sign as soon as you get the call that your documents are ready for signature. Any delay can cost you the house!
• Provide any last minute required documents to the lender or escrow officer as soon as you are asked for them.
• Have a back-up plan just in case there is a delay in the closing. It is not uncommon for a sale to be delayed by the lender, the seller if it is a Bank, the wiring of funds, or an unforeseen last minute requirement of the lender or title insurer.
• Do not ask for possession before the actual close of escrow. Early possession will require the seller to buy landlord’s insurance and you will need tenant’s insurance. Insurance will not pay out on a claim for an non-owner occupied property in the event of an incident. This creates a very risky situation and as a real estate agent I must advise against such possession.