What is an Escrow?
Regarding Arizona real estate, an escrow is normally a deposit of funds, by one party for delivery to another party upon completion of specific events. Specifically, escrow is all monies, instructions and documents necessary for the sale of an Arizona home. This includes the buyer providing funds for a down payment, and the seller depositing the deed to Arizona real estate and any other necessary documents. Escrow is a neutral, independent account by which the interests of all parties to a transaction are individually protected
When opening escrow, the buyer and seller of metro Phoenix real estate establish terms and conditions for the transfer of ownership of that property. These are given to an independent third party known as the escrow holder. The escrow holder has the fiduciary responsibility to see that all terms are met, i.e., pay out the funds and transfer the title only when all requirements of the escrow have been completed.
How is Escrow Opened in Arizona ?
Every state is slightly different, when dealing with Arizona real estate, the buyer's real estate agent will open escrow.
At the appointment to sign escrow papers, all parties signing the documents must bring proper identification, either a valid driver's license, state ID card or current passport, to verify identities before an Arizona notary public.
After both parties have signed all the necessary documents, the escrow officer will return the buyer's loan documents to the lender for final review. After the review is completed, the lender is ready to fund the buyer's loan and informs the escrow officer.
The length of an escrow can range from a few days to several months and is dictated by the terms of the purchase agreement.
Escrow Closing in Arizona
An escrow officer verifies that all conditions of the escrow have been satisfied, takes care of all technical & financial details, and then informas the parties and their agents when the escrow has closed. An escrow closing signifies the legal transfer of title to metro Phoenix real estate from the seller to the buyer. Generally, the Deed of Trust is recorded within one working day of the escrow holder's receipt of loan funds. This completes the transaction and signifies the "close of escrow." The final closing papers are disbursed upon close of escrow, when the escrow officer verifies with the Maricopa County Records Office that the documents have recorded and legal transfer has occurred.