Made Your Escrow Deposit
What Happens Next?
Congratulations, you are on your way to owning your very own home! Follow these suggestions (and your Realtors's advice) so that escrow and settlement with go as smooth as possible.
So you've found a home, submitted an offer and the seller has accepted. One of the very first things you will be doing after going under contract is to make your escrow deposit. This amount of this escrow deposit should of been established in the details of your offer and typically ranges between 1% of the home's sales price and can go as high as you the buyer are comfortable with. The higher the amount the more serious you look in the eyes of the seller. Just keep in mind that if you back out or default on the contract for a reason outside of one of the contract contingencies, this escrow deposit can be lost to the seller. Your agent should explain these details to you prior to submiitting an offer.
During this period after going under contract, you are going to need an escrow or settlement company to act as an independent third party so that you know when and who to give your money to get the deed to your new home. In our area the seller will usually select the title/closing company and in return the seller will be paying for a owner's insurance title policy on your behalf. This policy averages about $5.75 per $1k of the sales price. Again, typically paid by the seller. This escrow or settlement company will hold your deposit and coordinate much of the activity that goes on during the escrow period. This deposit whether it be a cashier's check or a wire, will held by the settlement agent. Make sure that there are sufficient funds in your account to cover this check.
The deposit check will utlimately be cashed and assuming the sale goes through, this money will be applied towards the purchase price of your new home.
You've made it! Once the sale has closed, you're the proud owner of a new home. Congratulations!
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