Oahu Real Estate Escrow
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Escrow

See a sample timeline to understand the escrow process better.

Is the acceptance date and the opening escrow date the same?

What type of tenancy should I use to hold the title?

What happens if the home has a tax lien on it or a mechanics lien?

What is the difference between the two types of title insurance? Should I get the more expensive one?

How do I know the home has no title issues?

What portion of the closing costs does the seller cover?

What happens if the seller paid the taxes and other fees just before closing?

Who should I use for escrow, does it make a difference?

What are the escrow and title insurance fees?

See a sample timeline to understand the escrow process better.

Day 1 Make initial deposit, choose termite inspector, setup home inspection date, notify lender of accepted offer.
Day 3 Submit completed and signed application for your loan. Provide pre-qual or pre-approval if not already done with offer.
Day 7 Disclosure received. You have 10 days to review it.
Day 7 Title report delivered by escrow. Escrow will review it for issues so they can issue Title Insurance.
Day 12 Home inspection completed. Once an agreement is reached, the additional deposit is made.
Day 15 Return escrow paperwork including choosing tenancy.
Day 20 Condo docs and subdivision documents delivered if applicable. You have 10 days to review these documents.
Day 30 Survey completed. You have 7 days to review for any encroachments.
Day 30 Conditional loan commitment letter due. You have 7 days to satisfy conditions other than those satisfied before closing.
Day 30 Termite inspection report delivered. If substantial damage is found, the disclosure must be updated.
Day 40 Final walk through. Verify everything is in the same condition as it was during the inspection. Verify that any repairs are completed.
Day 42 Sign the loan paperwork and escrow documents. Wire transfer or Hawaii cashier's check delivered for the down payment.
Day 42 Seller cleans. Does not require a professional cleaning service except for cleaning carpets and pet treatment.
Day 43 Loan funded, escrow notifies the state about the purchase, and they will confirm in 2 days.
Day 45 Closing. We will get you the keys on this day. Congratulations!

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Is the acceptance date and the opening escrow date the same?

No. The acceptance date would be the date the contract is signed by both parties. This could be on a weekend or holiday. Escrow would be opened the next available business day. Many deadlines on the contract are a certain amount of days from the acceptance date, so it is important to remember that the minute you have a contract signed by both parties, you have your acceptance date and the escrow clock starts ticking.

Escrow provides a timeline based on the contract, so you will know all the deadlines. We will remind you of any upcoming deadlines too.

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What type of tenancy should I use to hold the title?

See PDF document.

What happens if the home has a tax lien on it or a mechanics lien?

Escrow will clear all liens before transferring the title to you. They can use the money from the sale to do so at closing. If they are not able to clear the lien they will let us know and then unfortunately the sale can't go through.

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What is the difference between the two types of title insurance? Should I get the more expensive one?

If you are buying a short sale or foreclosure, I always recommend the additional coverage as it covers you for any mechanics liens that might come up. As the seller ran out of money there is a chance they did not pay a bill to a contractor. On regular sales you probably do not need the extra coverage but because it costs so little and stays with you the entire time you own the home, some buyers get it just in case. Please see the PDF to compare the more comprehensive policy. Eagle Policy Comparison

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How do I know the home has no title issues?

Escrow has a title department that reviews the title for issues. They are going to issue title insurance so they need to make sure there are not going to be any issues. You can be confident when escrow issues title insurance that your title is free and clear from any liens or other issues.

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What portion of the closing costs does the seller cover?

Section F-6 on the contract covers this in detail. The rule is the seller pays 60% of standard title insurance. Notice this is standard insurance--if the buyer elects to get additional coverage, they pay 100% of the addition coverage amount.

The escrow fee is split 50/50. There are other fees the seller normally pays, such as the cost of the survey, termite inspection, and termite treatment if needed.

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What happens if the seller paid the taxes and other fees just before closing?

The timing of paying taxes and home owners association fees, etc. does not matter as everything is prorated by escrow. So you end up paying these items for the days will own the home, no more and no less.

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Who should I use for escrow, does it make a difference?

It can make a big difference. I have seen escrows go horribly wrong due to a mistake by escrow. Sometimes they even cause the transaction to cancel so you would lose the home you desire, and time and money too. That being said, most escrow officers are very competent, and it is very rare that escrow causes a problem, so in general you will be OK with most escrow officers and companies.

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What are the escrow and title insurance fees?

Each company has their own fees, and they are increased on a regular basis. However, they are all competitive with each other, so no one company is a lot more or less than the other competitors. Here is a sample for First American Title. Note that it is divided into seller's portion and buyer's portion.

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