Page 6 - Kim Sargent GuideBuyerCustom.pdf

Tips To Make Your Closing Worry Free

Fire Insurance Policy: Funds to close escrow:
Your lender will require a hazard insurance policy naming Funds deposited for close of escrow should be in
the new lender as the Loss Payee. It is to your advantage the form acceptable to the escrow agent. An
to shop for best pricing. Having placed your insurance, escrow agent will require a cashiers check from a
instruct your agent to call Driggs Title, as additional infor- local banking institution or wired funds. Out of
mation will be needed to complete town and personal checks will cause a delay in
your policy. the transaction. Title companies do not accept
cash.
Prepaid Interest: Close of escrow:
Example: The Arizona definition of close of escrow is
Interest on your loan is paid in arrears (for example, recordation completed with the County
your escrow closes June 10th – Driggs Title will Recorder’s Office. Signing lender and escrow
collect prepaid interest from June 10th to July 1st.; documents is not closing. Following
your first payment on the new loan is due August appointments by purchaser and seller to sign
1st, which pays interest from July 1st to August 1st). their individual packages, Driggs Title packages
and returns them to the lender for review.
Lender Required Fees: Lenders may take 24 to 72 hours to review and
PMI (Private Mortgage Insurance): fund. Following the lender deposit of funds into
Usually 0.05% point fee. Should your lender require escrow, Driggs Title presents the original signed
PMI, (required on new loans wherein a borrower documents (deed, deed of trust) to the County
puts less than 20% down towards the new loan,) Recorder for recordation. Recordation is the
expect 1 year prepaid PMI in escrow, plus 2 “Close of Escrow”.
months deposited into an impound account. Power of Attorney:
If any one of the purchasers will be unavailable to
Fire Insurance: sign the lender/escrow packages, notify the
One year prepaid in escrow plus 2 months Realtor immediately. Your Realtor will notify your
deposited into an impound account. Typically loan officer and Driggs Title. Many lenders will
referred to as Homeowners Insurance. accept a Power of Attorney in advance.
Real Estate Property Taxes:
Depending upon the month of closing, a lender will Synopsis – For many prospective buyers, the closer
require a property tax reserve which will include it is till the closing date, the more worried they
become. Follow some of these tips to make your
enough funds to enable the lender to pay the taxes transaction smooth.
when they become due plus an additional two-
month cushion.
Credit Cards / Personal Loans / Car Loans:
Depending on the loan ration to your income, a
lender may require all or a portion of your debts be
paid off in escrow. They supply escrow with
estimated balances, however it is your
responsibility to provide Driggs Title current billings
for payment. Escrow does not check balances or
recent payments made.

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