Understanding Escrow: Review a Typical California Escrow Timeline
Whether you are buying or selling a house, as a layperson the escrow process may seem confusing. The good news is that you have Neighborhood Escrow here to help you. We are happy to explain any step of the escrow process you are not sure about and we will walk you through the process. In the meantime, keep reading to get an idea of a typical California escrow timeline.
Day One: You Are in Pre-Escrow
Once the seller has accepted an offer from the buyer, and a purchase agreement contract has been signed, escrow starts. Get ready to fill out more forms, to be in contact with Neighborhood Escrow on a regular basis and to work towards getting the real estate transaction closed.
Days Two – Five: Escrow is Funded
At this point, escrow must be funded. This means that some percentage of the down payment, also known as earnest money, is deposited into the escrow account. Typically, the buyer’s real estate agent will do this. The escrow officer will send them specific escrow instructions, which likely includes a grant deed that needs to be notarized, escrow instructions that need to be signed, tax forms, and other forms. The seller must get these back to the escrow company for the transaction to move on.
Days Three – Twenty: Disclosures and Inspections
In this timeframe, the buyer is doing their due diligence to ensure the property doesn’t have hidden issues. The buyer will need access to the property at this time, and the seller is required to keep the utilities on through the close of escrow. The buyer will also receive a list of disclosures related to the property, as required by California law.
Next is the home inspection, in which a general contractor inspects the home. There may also be specialty inspectors such as chimney inspectors, pest inspectors, foundation inspectors, or sewer inspectors if any of these issues are a concern.
Day 20 and Beyond: Negotiations Based on What Was Found in the Inspection
After the inspection is completed, the buyer has the right to request repairs. They may ask the seller to make the repairs themselves, or to reduce the price by the cost of the repairs. Once both sides have agreed, the buyer will sign the inspection results and the process can move on.
Day 24 and Beyond: Securing Funding
The final steps are all to be completed by the buyer. They must have an appraisal completed, get their homeowner’s insurance in place, and secure funding with their lender. Once this has been done, the loan contingency will be removed.
If you are buying or selling a home and need to work with an experienced escrow agent then we welcome your call to Neighborhood Escrow at 310-378-2456.
