Once an offer is successfully negotiated escrow is opened with a local escrow company. The escrow officer is a neutral third party who coordinates the various parts of the transaction. She (usually) will
- Hold all documents and monies required to complete the transaction.
- Arrange for the payoff on all debt against the property including mortgages, taxes, and home owner association fees.
- Arrange for the receipt of funds from both the buyer and any possible lender
- Calculate those monies and provide all parties with a balance sheet.
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The Title Officer will:
- Examine all records associated with the property.
- Determine the legality of the transfer
- Arrange for title insurance to be issued protecting all parties if the transfer is in some way flawed
- Arrange for the transfer of title with the County
It is customary in Santa Barbara County for the escrow fee to be split between the two parties and the title insurance to be paid for by the seller though most lenders will require an upgraded title which would be paid for by the buyer.