FAQ

The escrow process was developed to help facilitate the sale or purchase of property. When opening an escrow, the seller and buyer of a piece of property establish terms and conditions to facilitate a transfer of ownership of that property. These terms and conditions are given to a third, disinterested party known as the escrow holder. The escrow holder in turn has the responsibility of seeing that the terms of the escrow are carried out.

Typically the listing agent will select the escrow company. As a buyer, or as an agent representing the buyer, you can request to negotiate this term.
The escrow holder could be any disinterested, third party, although some states require that certain escrow holders be licensed. Due to the technical nature of the transaction and because the escrow holder will be handling your money, it is advisable to select an established, licensed, independent escrow firm, such as Home Escrow Services LLC.

Independent escrow companies are licensed by the Virginia Department of Commerce and must adhere to very strict requirements, known as “Escrow Law.” Escrow Law determines the kinds of qualifications an escrow officer must have, licenses the business must keep, regulations on how to manage files, the amount of insurance the escrow firm must carry, and much more. Independent escrow companies must steadfastly adhere to these regulations at all times.
Controlled, non-independent, or unlicensed escrow companies can be held by attorneys, banks, real estate brokers, mortgage brokers, or title companies. These agencies do not have regulations as strict as those who are licensed by the DOC.

Escrow fees are generally split evenly between the buyer and the seller, however, this term is negotiable. The buyer will bring their portion of the escrow fee into escrow with the down payment and closing costs. The seller’s escrow fee will be paid when the escrow closes and proceeds are disbursed. The seller’s fees are deducted from the proceeds.

The escrow officer is trained in real estate procedures, title insurance, taxes, deeds, and insurance. They are the middleman, working between the agent, lender, title company, and other entities to ensure all terms of a purchase or sale are met and that all paperwork and agreements are completed and recorded accurately. If there are any issues that arise during escrow, such as a lien on a property, the escrow officer will work directly with the entities involved to resolve the issues and move forward with closing in a timely manner.
It is important for an escrow officer to remain impartial throughout the entire escrow process. The escrow officer, while courteous, will limit comments to the business at hand. This formal behavior is meant for the benefit of all concerned since the escrow officer must follow the instructions of both parties.

Unlike your automotive or home insurance policies, title insurance is a one-time fee at closing that protects you and your heirs against certain claims to your property. During the closing process, we will verify the records and deed of your new property. However, records aren’t always complete, and claims do happen. If a better claim to your property is in fact made in the future, title insurance protects your investment by offering protection against financial loss, or worse, the loss of your property.

If you purchase your property with the use of a loan, your lender will have a Lenders Policy. This policy protects the lender against the same kind of claims against the property but is not extended to you. In order for you to be covered, you will need to purchase an Owners Policy. 

Hidden title issues are still a challenge as records and property histories cannot always be verified to the standard we wish was possible. While this issue is not the fault of your searcher or yourself, <em>Title Insurance</em> provides financial protection for you and your family to ensure that your claim to your property remains yours even if a claim does arise.