Title and Escrow: What You Need to Know
When buying or selling a home, two key parts of the closing process are title and escrow. Understanding these can help you feel more confident and prepared as you move through your real estate journey.
What Is Title?
The title is the legal documentation that proves ownership of a property. Before a sale is finalized, a title company will perform a title search to ensure there are no issues—like unpaid taxes, liens, or ownership disputes—that could affect your rights to the property.
Once everything checks out, the buyer receives clear title, meaning they legally own the home without any hidden claims.
What Is Escrow?
Escrow is a neutral third-party service that holds funds and documents during the transaction. It ensures that both the buyer and seller meet all the agreed-upon conditions before the deal is completed.
Think of escrow as a safety net—it protects everyone involved by making sure the money and paperwork are handled fairly and securely.
FAQs About Title and Escrow
Q: Who chooses the escrow company?
A: In California, it's common for the seller to choose the escrow company, although this can be negotiated as part of the purchase agreement. Your real estate agent can help guide this decision to ensure a smooth transaction.
Q: How long does the escrow process take?
A: Most escrows close within 30 to 45 days, but this can vary depending on the complexity of the transaction.
Q: What are escrow fees?
A: Escrow fees cover the cost of managing the transaction and are usually split between the buyer and seller.
Q: Can I use my own title company?
A: Yes, you can request a specific title company, but it should be agreed upon by both parties involved in the transaction.
