What Happens During Escrow

1. Escrow Account Is Opened

• A neutral third party (escrow company or attorney) is assigned

• Buyer deposits earnest money (good faith deposit)

• Funds are held securely until closing

👉 Protects both buyer and seller

📄 2. Title Search & Insurance

• Title company checks ownership history

• Ensures there are no liens or legal issues

• Title insurance is issued

👉 Confirms the seller has the legal right to sell

🔎 3. Home Inspection

• Buyer hires an inspector

• Identifies issues (roof, plumbing, electrical, etc.)

• Buyer may request repairs or credits

👉 This is where renegotiation often happens

💰 4. Appraisal by Lender

• Lender orders an appraisal

• Confirms the home’s value matches the price

• Required for loan approval

👉 Protects the lender (and indirectly the buyer)

🏦 5. Loan Processing & Approval

• Buyer submits final documents to lender

• Underwriting reviews finances

• Loan gets final approval

👉 This step must be completed before closing

🛠️ 6. Negotiations & Repairs

• Seller may fix issues or offer credits

• Both parties agree on final terms

• Contract is updated if needed

👉 Keeps the deal moving forward

🧾 7. Final Paperwork & Disclosures

• Review final closing disclosure (cost breakdown)

• Sign required legal documents

• Ensure all conditions are met

👉 Everything must be accurate before closing

🚶‍♂️ 8. Final Walkthrough

• Buyer checks the home one last time

• Confirms repairs are completed

• Ensures property is in agreed condition

👉 Last chance to catch problems

🔑 9. Closing (End of Escrow)

• Funds are released to the seller

• Ownership is transferred

• Buyer receives the keys

👉 Escrow officially ends here 🎉

⏱️ How Long Does Escrow Take?

• Typically 30–45 days (can vary)

• Depends on financing, inspections, and negotiations

⚠️ What Can Go Wrong During Escrow?

• Low appraisal

• Loan denial or delays

• Inspection issues

• Title problems

👉 Most deals that fall through happen during escrow

🧠 Final Insight

Escrow is all about reducing risk and ensuring fairness:

• Protects the buyer’s money

• Protects the seller’s property

• Ensures all conditions are met before finalizing

👉 It’s the safety net of the entire transaction