Are you looking forward to buy a home in Nashville, Tn, and eyeing for a sweet deal? Then, as a buyer, it is required to know about the escrow process which is an important aspect to consider when Home In Nashville TN. If you are new to Nashville and as a buyer want to execute a trustworthy deal, escrow is the right option for you. Escrow is the involvement of a third party that holds your asset and related documents to complete all your real estate transactions.
What exactly an Escrow is?
Well, Escrow is an account opened to handle the property transaction. The account includes the exchange of money and related documents. The account is held by a third party on the behalf of both buyer and seller who are in the process of executing the transaction for property.
While opting to open an Escrow account, you might require to shelve out a particular amount of fee charged by the escrow account holder (third party agent). The fee is to hold the funds or assets until both parties fulfill their contractual responsibilities.
Why Escrow is Important for Home Buyers?
Escrow is carried out when two parties get into the process of completing a transaction for buying/selling home. To eliminate the uncertainty in a way that one party or another will be able to fulfill contractual obligations, escrow plays a crucial element.
For home buyers, escrow is a platform to protect their investment and interest to be put before having a complete right on the property. If a buyer doesn’t go for the escrow account, he would have to pay the financial amount directly to the seller, which could create a matter of dispute between the two.
If one opens the account, escrow ensures the seller that buyer has made the payment required for the property. Depositing money into an escrow account protects the buyer from any unreasonable use of money from the seller’s end. Moreover, if the buyer decides to withdraw from the process of buying a home without related cause mentioned in the purchase agreement, the buyer may have to lose all money in the account as a penalty.
What Role Escrow Agent Play?
An escrow agent is a third party who knows all the ins and outs about the escrow account and maintains the needful on the behalf of both the parties. The third party is an Escrow Agent. An escrow agent may be a bank, any private lending institution, or an organization that deals in real estate. The agent here is responsible to deposit or withdraw on the behalf of the buyer’s account.
Roles and Responsibility of an Escrow Agent –
Escrow agents are responsible for multiple things at once which are as follows:
- They will hold all the paperwork and money and keep it safe and secure for making transactions.
- They will collect all the personal information right from loan to social security, assets which can be money, fund, or stock.
- They will be conducting a Title Search to know who is the owner of the property
- They will be responsible for preparing documents such as Deed of Trust which is an agreement done between a lender and a borrower to hand over a property to a neutral third party who acts as a trustee.
- They are responsible to hold earnest money and other deposits as well.
- They will be determining the prorations of property taxes, HOA set-up fee, and HOA dues.
- They will issue the Title Insurance policy that protects investment and provide coverage against financial loss.
Escrow After Owning the House
Once the buyer owns the home, he might need to continue the escrow account for a certain time period. This is because the lenders would require the homeowners to provide some amount in the escrow account to fulfill other costs such as – Homeowner association fee, property taxes, and Home insurance. However, if a lender allows the homeowner to close the escrow account, such expenses should have to be managed and covered individually by the homeowner.
If you are interested in buying or selling Home In Nashville TN, We at Zivak Realty can guide you through the process right from opening an escrow account to preparing documents to provide the necessary guidance on the current market conditions made possible by our cultivation of relationships with banks, lenders, attorneys, inspectors, and contractors.
Dealing in a real estate investment is a complicated process that requires lots of paperwork and legal formalities. So, let Zivak be your Property assistant to fulfill your dream of buying your desire property with ease.