What Happens During Escrow? Understanding the Process from Start to Finish

When buying or selling a home, one key question often arises: what happens during escrow?

Escrow is a neutral process that protects both the buyer and the seller during a real estate transaction. It ensures that funds, documents, and property rights are handled securely before closing.

At Hera Title, we help clients navigate every step with confidence. Our goal is to make the title and escrow services process transparent and efficient for all parties involved.

What Is Escrow and Why Does It Matter?

In real estate, escrow acts as a secure holding period managed by an independent third party. What happens during escrow ensures all funds and documents remain safe until every condition in the contract is met. The process protects both sides and helps avoid legal or financial risks.

According to the Consumer Financial Protection Bureau (CFPB), escrow helps ensure that closing funds are only released once all required steps are completed, providing peace of mind for both buyers and sellers.

Key Purposes of Escrow

• Ensures funds are only released when all terms are met
• Confirms property ownership is transferred correctly
• Protects against fraud or incomplete documentation
• Creates a clear record of all financial and legal steps

Your escrow timeline serves as a neutral safeguard, giving buyers, sellers, and lenders confidence that the deal will close properly.

Escrow Process Explained

The escrow process begins after the buyer and seller agree on terms. A licensed real estate escrow company like Hera Title opens an escrow account to manage funds and documents.

1: Opening Escrow
The real estate agent or lender initiates escrow. The escrow officer collects the signed purchase contract, and the buyer deposits earnest money into the escrow account to show commitment.

2: Verification and Documentation
The escrow officer reviews the sales agreement, lender instructions, and all required documents, such as property disclosures, identification, and loan details.

3: Title Search and Insurance
A title search confirms that the property is legally owned and free of issues. Once verified, a title commitment is issued, linking escrow to the title process, two key steps in the same transaction. For more on why this step matters, the American Land Title Association (ALTA) notes that title insurance protects against past ownership disputes or legal defects.

4: Loan Approval and Appraisal
The buyer’s lender finalizes the mortgage loan, and an appraisal ensures the property value matches the loan amount. Hera Title coordinates with all parties to keep the process on track.

5: Review of Closing Documents
The escrow officer prepares the deed, settlement statement, and lender forms. Buyers and sellers review and sign to confirm accuracy and understanding.

6: Final Funding and Recording
Once all conditions are met, the buyer’s funds are transferred to escrow, the seller is paid, and the deed is recorded with the county, marking the end of escrow and the start of ownership.

How Escrow Protects Both Buyers and Sellers

Escrow safeguards the interests of everyone involved in a property sale.

Buyers

• Protects earnest money until all terms are met
• Ensures property title is clear before purchase
• Confirms inspections and repairs are completed

Sellers

• Guarantees verified funds before title transfer
• Confirms buyer financing requirements are met

Lenders

• Confirms all legal and financial obligations before releasing funds

As outlined by the National Association of Realtors (NAR), escrow ensures the fair handling of funds and documentation during property transfers, helping reduce risks on all sides.

Common Escrow Delays and How to Avoid Them

Most escrow periods last between 30 and 45 days, but delays can happen.

Common Causes

• Incomplete loan documentation or signatures
• Title issues like liens or boundary disputes
• Delays in inspections or appraisals
• Miscommunication between lender and agent

How to Avoid Them

• Partner with an experienced title services provider
• Review all documentation early
• Respond promptly to requests
• Choose a company with strong coordination with local title and county offices

At Hera Title, we streamline communication and handle coordination to keep everywhat happens during escrow escrow on schedule.

Escrow vs. Closing: What’s the Difference?

Although they’re closely related, escrow vs closing refers to distinct phases:

Escrow

• Begins after contract signing
• Manages funds, documents, and conditions

Closing

• Occurs at the end of escrow
• Finalizes signatures, disburses funds, and records ownership

Think of what happens during escrow as preparation, and closing as the finish line.

Hera Title’s Role in Managing Escrow

Hera Title combines expertise, communication, and technology to make escrow simple and transparent.

Our Escrow Services Include

• Secure management of funds and contracts
• Coordination between buyer, seller, and lender
• Real-time updates to avoid confusion
• Fast communication with county offices
• Clear guidance for both first-time and seasoned clients

We also make it easy to understand your average title fees at closing before the process begins.

Final Steps After Escrow Closes

When escrow closes, ownership officially transfers to the buyer. The escrow officer provides copies of the recorded deed and settlement statement.

Post-Closing Tips

• Store your title policy and deed safely
• Set up property tax and insurance payments
• Review your final settlement for accuracy

These final steps ensure smooth ownership and protection moving forward.

Trusted Title and Escrow Services You Can Count On

Escrow doesn’t have to be complicated. With the right partner, it becomes a transparent and secure process. At Hera Title we handle every detail with professionalism and care so you can focus on what matters, your move.

Ready for a Smooth Closing?

Buying or selling a home should feel exciting, not stressful. Contact Hera Title today for title and escrow services you can count on.