What Does Closing Escrow Mean?

Closing escrow is a big, important and essential step along the road to buying a home in Austin.  For those who have never bought a home, closing is often viewed by many as an unexplained and overwhelming experience. It’s the final step in the process of transferring title (ownership) to the buyer.

Become Familiar with the Closing Process in Austin

If you are planning to buy a home in Austin, it would behoove you to become familiar with the closing process.  Doing so will take away much of the mystery and confusion that people sometimes equate with closing.

Who is Going to Attend the Closing?

The Buyers – of course – will meet with the Escrow Officer, who is essentially the orchestra leader.  He or she has prepared the documentation needed to transfer title, an accounting statement (aka closing statement) that shows where all the money came from and where goes to and makes sure that the buyers properly sign the loan documents provided by the lender securing the buyer’s loan.

The Mortgage Broker or Loan Officer should be on hand to answer any questions the buyers may have about the loan. As Buyer’s Agents, we attend all of our client’s closings to address any real estate questions that may arise. Sometimes a Settlement Attorney is needed in complex transactions. Typically, the buyer and seller will meet separately with the escrow officer to facilitate the process.

In the buyer’s closing, it is usually the buyers, buyer’s Realtor and the escrow officer in the room.

How Much Time Should I Budget for Closing?

Allow Ample Time. Closing means paperwork and a lot of it.  If the Buyer is getting a loan, the lender will provide escrow with a loan package including a Promissory Note and usually a Deed of Trust which creates a promise to re-pay the loan and secures the property as collateral.  If the Buyer is getting a complex loan like an ARM or FHA loan, the paperwork will inflate. You’ll probably have questions about what you’re signing; sometimes the answers will require lengthy explanations. Occasionally, mistakes are discovered and must be corrected.  All of this takes time.  So, we recommend that you reserve not less than 1.5 hours and as much as 3 hours to complete the process.

What Do You Bring?

Your Buyer’s Agent will bring the real estate paperwork (e.g  Purchase Contract). You will need to bring:

• Photo Identification (e,g Texas Driver’s License or Current Passport)
• Copy of the Homeowner’s Insurance Policy or Proof of Insurance
• Cashier’s Check for the full amount needed to complete the purchase

The escrow officer should have sent you an estimated amount in advance of your meeting so you can obtain a cashier’s check or arrange a wire transfer.

When Do I Get the Keys?

Getting the Keys. In Austin, close of escrow and getting the keys (possession) can happen at the same time, or within a couple of hours of each other. With proper planning and co-ordination, the Buyers can take immediate possession of the home upon completion of the paperwork.  Other times, buyers may have to wait a couple of hours to make sure the loan is funded before they get the keys. At any rate, it happens fairly quickly after signing.

When Should I Turn On Utilities?

Make prior arrangements for water, electric, waste and utility transfer to avoid disconnects. When you have a closing date, call a couple of days before to make sure you don’t show up to a dark house. Hint: The utility information can be found on the Seller’s Disclosure you received when you made an offer. Also, be sure to ask the seller for any manuals and instruction booklets that they may have available.

Closing Should Be Exciting, Not Scary

Closing escrow is an exciting time for all of us. With a little knowledge, understanding and preparation it can be a seamless, smooth and efficient. We can help make that happen. Check out our Austin Home Buyer Representation Program to learn more about how our Home Buyer Program can help make your next home purchase seamless, smooth and efficient. Then call us at (512) 827-8323, email us at info@11OaksRealty.com or fill out our Buyer Survey to schedule a no obligation consultation.