When buying or selling a home, the escrow period can be a time consuming and frustrating part of the process. You just want the deal to be done, but there are still things you need to wait for.

Both the buyer and seller are involved in escrow, but the one shared goal is to close escrow as soon as possible. Until escrow is closed, the financial transaction and related paperwork is still pending, and the deal hangs in the balance.  Most people only have a vague understanding of what escrow actually is and what to expect.

But you can make the process easier and less chaotic by doing a few simple things.


What Is Escrow?

First, let’s define the word for you. Escrow refers to a third-party service that is part of every home purchase. When a buyer and seller initially arrive at a purchase agreement, they select a neutral third party to act as the escrow agent. The escrow agent collects a deposit from the buyer that is equal to a small percentage of the sale price. This deposit is known as “earnest money”. In exchange, the seller takes the property listing off the market. Until the final exchange is completed, both the seller’s property and the buyer’s deposit are said to be in escrow.


How Does an Escrow Account Work?

Escrow accounts are a part of the mortgage process homebuyers typically cannot avoid. With mortgages, home buyers typically pay a little extra into an escrow account every month, along with their home loan payments.

While a mortgage holder (most typically a bank) collects the principal and interest payments each month, they also can collect homeowner’s insurance payments and property taxes. They will then pay those bills when they come due. They do this because when you borrow money from a lender to finance your home purchase, the property becomes the collateral for your loan. Your lender needs to know that the property is adequately insured so that it can be repaired or replaced if damaged. Likewise, they want to prevent a tax lien being placed on the property if you neglect to pay taxes.


Type of Escrow Accounts

There are two types of escrow accounts that are part of the homebuying process: The real estate, or pre-closing escrow account, and the mortgage escrow impound account.

  • Mortgage Escrow Account: Sometimes called an impound account depending on where you live, these types of accounts are set up by your mortgage lender to pay certain property-related expenses on your behalf. If your loan includes an escrow account, you will pay monthly installments for taxes and insurance along with your monthly mortgage payment. Your mortgage servicer will deposit these monthly installments into the escrow account. Then, your servicer uses the funds to pay your bills when they come due, typically once or twice per year.


  • Real Estate Escrow Account: Also called pre-closing escrow accounts, these types of accounts are held by third party entities separate from both the buyer and the seller, and are designed to protect the interests of both. These accounts hold all funds, instructions and paperwork necessary for the impending real estate sale, including funds for the down payment and the deed to the home. The rest of this post concerns this type of escrow account only.


Prepare Yourself By Reading These Tips For Getting Through Escrow!

1. Build Strong Relationships

Hopefully you have a real estate agent you trust. Going through escrow can be difficult and unpredictable and you want a strong agent on your side. You are going to be leaning on them during inspections and negotiations and you do not want to find yourself second guessing their advice or explanations. Trusting them to do their job can bring you a lot of peace of mind. You can ask the important questions that lead to a successful realtor partnership and also inquire as to what recommendations your agent has regarding escrow.

Trust your agent, but check in together once a week at a minimum during escrow to stay on the same page.


2. Create an Escrow Timeline

Work with all parties to create an escrow timeline. The structure of a timeline provides a better understanding of what to expect and keeps you on track. When you open escrow, ask your agent to give you an overview of the timeline. Knowing when you have hit each milestone can help you feel like there is progress, rather than just weeks of anxiety and frustration.

The escrow process typically lasts between 30-60 days. You can view an estimated timeline of the escrow process from start to finish. But also understand that closing dates sometimes change. The escrow process involves many moving parts so delays can happen. The closing date is what everyone is aiming for but sometimes delays do come up, despite everyone’s best efforts.


3. Sign Paperwork Immediately

Get things done quickly! Small delays on your end can result in significant delays by other parties. Paperwork is the main thing you can control during escrow. Sign your documents as soon as you have carefully reviewed the content.  There are many moving parts and delays with paperwork can sometimes cause a late close.

A lot of times, buyer response time is what slows down escrow. It may seem as though there is not much going on from the buyer’s perspective but the truth is, the lender and escrow company are working very hard to make sure the sale closes and even a one-day delay in getting them something they need can slow down the works significantly

If you are working with an experienced lender, understand that they will hound you for paperwork, bank statements, income tax information, but if you provide what is needed in a timely manner you will keep the process moving along.


4. Pause Financial Changes

Do not make any financials changes while in escrow. Do not lease a new car, do not finance furniture or appliances, do not quit your job or do anything that can make a lender nervous. Just leave everything alone, try not to spend and be patient.  A good rule of thumb to use: if you think there is a chance it would impact your credit report, do not buy it!

Roadblocks for your escrow:

  • Buying a new car
  • Opening new line of credit
  • Making large purchases on your credit card
  • Missing bill payments


5. Prioritize Your Inspections

Inspections can be intimidating since no house is perfect. There will most likely be some concerning news about the property. Understand that this is the norm. When possible, schedule inspections as early in the escrow process as you can. If you need multiple inspections, try to book them all for the same day. The results of the inspection could prompt negotiations or repairs that extend your escrow timeline. Buyers and sellers alike can learn more about inspection day and avoid further delays by reviewing these home inspection tips.

6. See the Light at the End of the Tunnel!

Finally, relax and reflect upon the exciting purchase or sale that will happen soon. Breathe. Meditate. Go to yoga or go for a run. Escrow is a journey, but the more you can focus on the end result, the easier it will be. Expect the unexpected and avoid getting angry or frustrated.

Housing transactions are complicated, but you can still find ways to minimize stress and stay positive! No matter how crazy it gets, you will soon look back at this and breathe a sigh of relief.



When choosing an escrow company there can be many important factors to evaluate. Fees, location, staff and even recommendations from friends and colleagues are all things to consider. With Citrus Heritage Escrow by your side, you can rest assured that when you receive your settlement check, you’ve gained the maximum benefit from your home sale or purchase.


Call us today with any questions or concerns. Our professional Escrow Agents will help you through this exciting yet confusing process. (951) 335-7200