What is Escrow?

What is Escrow?

Escrow is the process by which you buy and sell a house. When you fill out the initial offer, a residential purchase agreement, you include and negotiate a certain amount of time with which to complete the sale. This time period is called an Escrow time period. The escrow period is generally 30 days for most sales that include a loan.

The term "Escrow" is also used to describe the Escrow company that manages the transaction from beginning to end. Escrow companies are licensed and bonded by the state of California and have the job of handling the finer points of the agreed upon purchase contract. 

The residential purchase agreement (offer) has tons of terms in it with regards to how to buy and sell a house. Escrow takes all the terms and makes sure to collect all the necessary documents and information from both sides, the buyer and the seller, and then coordinate the exchange of money and title. They also work closely with the lender.

The Seller generally chooses the escrow company that will be used in a transaction. However, the choice of Escrow, as with most thing in a contract, is negotiable.