Surviving Escrows

Congratulations, you're on your way to owning your very own home!
By following these recommendations and your realtors advice your escrow and settlement will go as smoothly as possible.
When choosing a down payment, the same rule applies, the more you pay now the less you'll pay later.
The next step in purchasing your new home is to hire a third party settlement company (or escrow) to handle your down payment and get the deed to your new home. The escrow or settlement company will hold your deposit and coordinate the activity occurring during escrow. Other alternatives are that an attorney or a broker's trust account holds the deposit check.
After that your deposit check will be processed and the money will be applied to the purchase of your new home. If for any reason the sale of your desired home does not go through, there is a strong possibility that you will receive a full refund of your deposit check, minus any cancellation fees. In rare instances the seller may seize these funds as liquidated damages. Always insist on speaking to your attorney about including a clause in your contract covering liquidated damages.
Once you have opened your escrow you have a commited agreement between you and the seller including closing date and contingencies. Most escorws last approximately 30 days and each escrow contract is unique, however most of them include the following:
1. Inspection contingency: This is the first on your list and should be completed immediately after signing the contract. Unsatisfactory results on the inspection mean either rewriting the initial contract or, based on damages, canceling it all together.
2. Financing contingency: Securing financing is equally as important, however you do have a brief period of time to do this. If, for some reason, have trouble securing the desired financing, the seller may grant you an extension period. The best way to handle this is to handle your loan approval up-front, so that you do not get emotionally invested in your new home, only to lose it later in the process.
3. Marketable title: Next review the title report with an attorney or title officer to check accuracy regarding local and state ordinances for property transfer. Your new title must be clear of any legal issues regarding your ownership.
4. Homeowner's insurance: Finally, secure insurance to cover your new home. The application process is often lengthy, so plan ahead. the best time to begin the application process is immediately after the contract has been signed.
5. Final walk-through inspection: At the same time that you schedule your first inspection also plan a final walk through inspection, to ensure that any of the requested repairs have actually been done and are not merely cosmetic in appearance.

And remember to always list all of the light fixtures and other ammenties that are considered "permanent fixtures" in the home and then check that list on the final walk through!

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