Common Questions about Escrow
Common Questions about Escrow
1. Why is Escrow Important?
Escrow is a service that protects the public and minimizes the potential risk involved in any real estate transaction. With an experienced neutral third party in possession of the legal documents and funds, which party is obligated to safeguard the instruments and funds, buyers and sellers, as well as lenders and borrowers, can safely interact with one another and be assured that no legal documents will be recorded, and no funds will be released, until all of the conditions of the real estate contract or agreement between the parties have been completed.
2. What types of transactions go through escrow?
All sorts of transactions use escrows to facilitate the transfer, lease, or financing of real or personal property. Escrows are most commonly used when – real property is bought, sold, or refinanced, but they are also utilized for the purchase or sale of business opportunities or mobile homes. Bulk sales, stock transfers, and holding escrows are less well known, but are other types of transactions handled by an escrow company. Escrows in non-real estate transactions (e.g., those for personal property) are beyond the scope of this publication.
3. Are escrow costs fixed by law; and how much do escrow services cost?
Escrow fees are not fixed by law or regulated by the State. The escrow fee is typically commensurate with the size and complexity of the transaction, the cost of performing the services, overhead expenses, and the liability involved. Some escrow holders may have a set fee schedule in place, or a formula that they use to calculate their escrow fee by using the selling price of the property in a sales transaction or loan amount in a refinance transaction.
Please note that escrow fees are only a portion of your closing costs. There are other closing costs that you will be responsible for that are not controlled by escrow holders. If you are using the services of a title company, mortgage broker and/or securing a new loan with a lender, there will most certainly be fees charged by those respective parties.
5. Who pays for the escrow fee?
In a real estate transaction, it is customary that the escrow fee be split between the buyer and seller. The northern and southern regions of California have different customs. Ultimately, however, the buyer and seller may negotiate and agree to any arrangement. This agreement should be reflected in writing in the purchase contract.
6. How should I take title to my property?
One of the decisions you will have to make when you are purchasing a property will be how you would like to hold title to the property. There are several different title vesting options (joint tenancy, community property, community property with right of survivorship) in California, and each one has different tax, legal, and/or estate consequences. It is wise not to rush through this part of the escrow paperwork. Rather, you should do your homework and consult a licensed attorney or tax professional if you have questions.
7. What happens when a transaction fail to close and the escrow cancels?
Many escrow instructions provide for cancellation of escrow in the event of a default. Where a transaction fails to close, the parties will need to execute a cancellation agreement. If the parties are able to come to a mutual agreement to cancel, it is likely that the parties will execute a “cancellation of contract” completed by a real estate broker. Also, most escrow companies will prepare and require their own mutual cancellation instructions to be executed, and this is especially true in cases where the escrow holds funds on deposit. Before the escrow officer can release any funds, the parties must agree to the disposition of the funds in writing. This instruction will include the payment of any applicable fees or charges incurred by the escrow holder or other costs indicated in the escrow instructions.
Information collected from http://www.dre.ca.gov
Olympus Escrow has extraordinary customer service with clients and real estate associates. The staff makes the process seamless and with a smile.
Questions about Escrow? Please Call for Your Grace for more information!
Grace Chih, Escrow Officer
Escrow Process & How to Prepare for it.
Prepare for Escrow Process
The following is a brief list of items that you will be expected to provide and/or deliver to your escrow officer:
- Correct spelling of your name and up-to-date contact information
- Contact information for lender (and/or mortgage broker) if new financing is being obtained
- Mortgage loan account information (lender or loan servicer’s name, address, and account number). If you are selling or refinancing a piece of property; plus any other tax, mortgage, bond or other lien information
- Fire insurance policy information
- Title vesting choice
- Copies of Trust Documents if taking title in trust or selling from a Trust
- Homeowner Association (HOA) and management contact information; copies of HOA documents if held by owner. Any relevant corporate, partnership or LLC documents if taking title in the name of one of those entities, or selling from one of those entities
Beware of Fraud
- Do your own homework and really check out your escrow holder.
- When possible, meet the people working for you in person.
- Retain a copy of everything you sign and receive.
- Do some research when you decide to work with an internet escrow agent who requires your deposit and fees to be sent over the internet.
- Be sure to question unexpected or last minute changes to documents and previously held agreements.
- Your lender and/or mortgage broker can most competently answer questions about your loan.
- Payments made outside of escrow.
Escrow Updates- from Olympus Escrow February 2017
Questions about Escrow?
Please Call for Grace for more information!
City Transfer Tax 城市房地產轉讓稅務
正常的房屋轉讓在各縣都會收取每一千元收$1.10的縣轉讓稅 (County Transfer Tax). 但是有少許城市像洛杉磯市有另外多收取市轉讓稅(City Transfer Tax).
就是說要是您想要賣掉位於洛杉磯市的房子, 除了本來每一千元將被收取的$1.10縣轉讓稅金, 還將被洛杉磯市加收$4.50的市轉讓稅.
以$500,000.00 (50萬)來估計的話, 縣轉讓稅$550.00 +市轉讓稅$2,250.00= 您將總共被收取$2,800.00 的稅金. 了解這些將幫助您更了解評估售價與所得!
但是如果有另一棟房子位於柯文那市 (Covina), 就沒有市轉讓費,只有縣轉讓費. 所以同樣是$500,000.00 的房子, 在賣屋時屋主只需繳交$550.00 稅金.
County Tax $1.10 per $1,000.00
The County assesses a Documentary Transfer Tax on the consideration or value of the interest or real property conveyed (exclusive of the value of any lien or encumbrance remaining thereon at the time of sale) exceeds $100 at the rate of $0.55 per $500 or fraction part thereof.
Additional Tax Rates for Specific Cities 以下5個城市在洛杉磯縣有多的市轉讓稅
The following five cities have passed ordinances imposing additional rates of tax per $1,000 of the consideration or value of property conveyed and is added to the present County Documentary Transfer Tax.
LOS ANGELES COUNTY
City Transfer Tax
Addition Per $1,000 Valuation
Culver City – $4.50
*Los Angeles – $4.50
Pomona – $2.20
Redondo Beach – $2.20
Santa Monica – $3.00
*Also Consider as City of Los Angeles:
Arleta Korea Town Silver Lake *Athens Lakeside Park Studio City Bel Air Lakeview Terrace Sunland Bel Air Estates Larchmont District Sun Valley Beverly Glen *La Tijera Sylmar Boyle Heights Laurel Canyon Sylmar Square Brentwood Leimert Park Tarzana Cahuenga Park Lincoln Heights *Terminal Island *Calabasas Los Feliz *Toluca Lake Canoga Park *Marina Del Rey *Topanga *Carson Mar Vista *Torrance Castellamare Mission Hills Tujunga Century City Montecito Heights *Universal City Chatsworth Monterey Hills Valley Plaza Crenshaw District Mt. Olympus Valley Village *Culver City Mt. Washington Van Nuys Eagle Rock North Hills Venice *East L.A. North Hollywood *Vernon East San Pedro Northridge *View Park Echo Park Olive View Warner Center El Sereno Pacific Palisades Watts Elysian Park Pacoima Westchester Encino Palasades Highlands West Hills *Gardena (FigueroaVermont) Palms *West Hollywood Garvanza Panorama City Westlake Glassell Park Playa Del Rey West L.A. Granada Hills Porter Ranch Westwood Hancock Park Rancho Park Wilmington Hansen Heights Reseda *Wilshire District Harbor City San Pedro *Windsor Hills *Hidden Hills *San Fernando Winnetka Highland Park *Sawtelle Woodland Hills Hollywood Sepulveda Hyde Park Shadow Hills *Inglewood Sherman Oaks
Grace Chih 撰文
2017 County Recorder’s Holiday Schedule!
2017 County Recorder’s Holiday Schedule! Good to plan your recording accordingly.
PDF click here! county-recorder-holiday
Grace Chih 分享
更多問題 歡迎來電 (626)538-1868
年底成交買賣房屋了, 開開心心的過戶了! 這個時候, 別忘了看清楚你的closing statement, 確定一下地稅Property tax到底付到甚麼時候. 如果是peroration 寫說是到年底 12/31, 那seller沒有付接下來該付的第2期稅哟! 因為地稅單是一次一年分兩次繳錢 (見上表)
第一期於7/1開始 12/31結束 ; 第二期於1/1開始 6/30結束. 每年9月出新的地稅付款單
Example: 12/20/16 是在2016-2017 Tax Year (cover 7/1/2016-6/30/2017)
當你在年底成交的房子, 屋主名字雖然已經在縣政府變成您的名字了, 但是county不會重新寄一份地稅單給你, 很多新屋主, 因為沒有接到稅單而超過4/10都忘記付款, 就會被罰繳10%+$10的罰金.
地稅是屋主的責任! 因為沒收到單子而被罰款是得不償失. 一定不要忘記!!!
New homeowner beware! See if 2nd installment is included in your closing statement, if not! Don’t forgot to pay it in February. You WILL NOT received a new bill in your name because property tax bill only release once a year in September. It’s your responsibility as a homeowner to make payment even when you did not receive a bill.
請見以下網站查詢或上網繳交. 教您上網付地稅 How to pay property tax online
Grace Chih 撰文
更多問題 歡迎來電 (626)538-1868
Electronic Signatures Consent Agreement 關於電子簽名
企業監督管理部門 (department of business oversight)核准公證公司於於託管文件上, 收取有電子簽名的文件. 您的地產經紀人會幫忙設置一個能電子簽名的帳戶, 這樣方便傳遞文件的方式只需簽一個同意書.
但不要忘記! 不能以電子簽名的文件像需要與縣政府登記的文件, 如產權轉讓書(Grant Deed)需要與公證人本人面對面的核對身分與在面前簽名. 這些都是需要正本的.
Grace Chih 撰文