Based on the escrow instructions, the escrow officer will process the escrow and handle the funds and documents from start to finish. As stated above, the instructions outline all of the duties of the escrow officer. An escrow officer is responsible for the preparation and processing of a significant amount of paperwork. That paperwork includes, but it is not limited to, escrow instructions and amendments, grant deeds and quitclaim deeds, estimated and final closing statements as well as HUD-1 statements required by lending institutions. Escrow officers also facilitate the request, delivery, and signing of documents, not only for the benefit of the principals, but for the real estate brokers, and the applicable title company and lending institution. The escrow officer must also comply with local, county, State and federal requirements relative to required documentation and fees. If the buyer is obtaining financing, the escrow officer will work with the mortgage broker and/or lender to help move the loan approval and underwriting process along, satisfy the lender's conditions, and will likely coordinate the loan document sign-up. Additionally, escrow officers will request closing funds, authorize the release and recording of documents, and are the primary party responsible for all of the accounting of an escrow transaction and disbursement of funds held in the escrow. Another large part of an escrow officer's job is requesting payoff demands and lien releases, and working to ensure that free and clear title will be conveyed to the buyer and in compliance with the lender's instructions, if applicable. In some ways, the escrow officer has one of the most difficult jobs in a real estate transaction as he or she is the neutral party to which all buyers, sellers, borrowers, lenders, real estate brokers, and title companies look to for the proper, efficient and effective administration of an escrow. An escrow officer is the communication link for all of the parties and the central place where buyers, sellers, real estate and mortgage brokers, and lenders go for updates, answers, and problems. Finally, it is the escrow officer's duty to ensure that all of the conditions of the escrow have been met before closing, where documents can be released and/or recorded, and funds transferred and/or disbursed.
It is also important to understand that because the escrow officer is a neutral third party, he or she does not represent or favor any one party to an escrow, and is instead an agent of the principals to the escrow. An escrow officer's role as a disinterested and neutral third party is very clear. For that reason, an escrow officer will never be involved in the negotiation of the contract or advise the principals with respect to the same.
When obtaining a loan, it is the responsibility of the buyer or agent of the buyer to arrange for a loan and negotiate with the lender, not the escrow holder. Similarly, in a short sale transaction, where the sale is contingent upon the approval of the short sale lender, it is the responsibility of the seller or agent of the seller to negotiate with the short sale lender, and not the duty of the escrow officer. Because an escrow officer may only act on instructions and documents agreed to by the parties to a transaction, if a dispute or disagreement occurs, the escrow officer must remain neutral and will not proceed until the parties have reached a mutual agreement. It should also be noted that an escrow officer is not an attorney and cannot give you legal advice. Only a licensed attorney can provide you with legal advice under California law. If legal and/or tax questions arise, it is recommended that you consult with a licensed attorney or qualified tax professional for assistance.
Lastly, because escrows are confidential in nature, the escrow holder has a responsibility to not give out any information to third parties concerning an escrow without the approval of the appropriate parties and principals to the escrow. At the same time, escrow holders have a legal obligation to reveal and disclose any new, detrimental, or material information that was previously unknown to the parties. Moreover, an escrow officer must maintain the highest level of trust and maintain a good working relationship with all of the escrow participants.
San Diego real estate agents
Wednesday, November 23, 2011
Tuesday, January 11, 2011
2011 San Diego Real Estate Market Direction
2011 San Diego Real Estate Market Direction
After the $8,000, Federal and California home buyer credits expired, the local San Diego real estate market entered into a double-dip continued erosion of home values.
After the homebuyer credits concluded, San Diego home values saw modest price appreciation. Now even this modest appreciation has disappeared. Even more troubling is that the resale home sales volume has been dropping at double digit rates for the last few months. Just from April to May the western states sales dropped a reported 20.9%. Huge double-digit declines in home sales are a major red flag that cannot be ignored.
When will the government learn that you cannot artificially create lasting demand? (Statistics show the vast majority of government housing programs, costing billions, are outright failures and have only prolonged our malaise.) I believe the best thing the government can do is to stay out of the housing market and let the open market clean up the mess.
Think about this: Bernanke initially spent almost $2 trillion to drive long-term interest rates down.
The $600 billion QE2 has no effect to date. Actually, interest rates have moved up substantially. There are a few months left, but I am sure Bernanke will use the "it would have been much worse" argument and declare success. The reality is that there will be no QE3, not with Ron Paul now as the watchdog of the Fed.
Our aging population, combined with a decreased standard of living can't equate to housing starts comparable to prior generations. I think our government’s relentless destruction of the middle class is making this different from prior real estate cycles.
Foreclosure moratoriums are beginning to expire. I believe the banks will push to clean up their portfolios through increased foreclosures.
Except for cash buyers, home pricing is derived from the affordability of the monthly payment. Should interest rates and taxes go up (a good bet), the purchase price will have to come down to establish a market. Construction labor is already about as cheap as you can get it and inflation for materials is already present. This spells very bad news for homebuilders.
As far as pent-up buyer demand goes, the gurus again have it backwards. It’s not buyer pent-up demand, but seller pent-up demand to unload their homes.
The depth and longevity of this San Diego housing value depression has been imbedded into the consciousness of the usual first wave of home buyers in their late 20’s and early 30’s. The high cost of living in San Diego has been further stressed with continued multiple raises in utilities, increased state taxes/fees, higher education costs and $3.00+ per gallon gas prices. This all equates to over-priced homes in the current world of qualifying for a home mortgage.
I just believe there are major problems with our economy at play that we have never seen before and that will have a deciding call on what happens with housing. I see demand based on finance rather than population at this point.
During the mid 2000's, almost the entire mortgage universe had been refinanced. This included many baby boomers that were in the last half of the 30-year mortgage they took out when they purchased their home. Some of this was hopefully to pay down other expenses and not to maintain their fantasy of the luxury lifestyle. The refinancing bubble that resulted from the irresponsible actions of Greenspan reset the 30-year mortgage clock. All borrowers looked at, was how the refinance lowered their house payment by $X per month, without giving a second thought to the fact that they have also extended the term to a new 30-year loan.
Another round of refinancing occurred when Bernanke pushed rates down to the 4% range. The only borrowers left who have not refinanced are those with no equity and/or are facing foreclosure.
In either case, now many Boomers who are reaching the traditional retirement age, find themselves strapped with 20+ years left on their refinanced mortgages. Instead of preparing for the mortgage burning party that their parents had when that generation retired, they are wondering how they can make house payments on a lower income during retirement.
Since this is the first year of the boomers reaching 65, it is going to be a negative drag on housing for years to come.
For the San Diego and California real estate market we have to contend with our own Cap & Tax laws going into effect in 2011 that will increase utility costs by 20% over the next five and speeding up the loss of manufacturing jobs. We also have a new, old governor who was against proposition 13 which sets a maximum cap on property taxes and will likely propose new massive state taxes to deal with a $25.4 billion budget deficit.
I will end my prediction with a challenge. I have 30+ years in residential real estate, I accurately foretold the 2005 bubble burst, and despite wanting to be wrong with previous “low” opinions I usually haven’t been. Do you want to bet against me?
My San Diego California real estate site provides full, unrestricted access to search the entire San Diego MLS . Also, if you want to see the actual current San Diego real estate sales activity and actual closed home prices, please visit San Diego home sales. San Diego real estate home market blog
San Diego California real estate agents
brokerforyou Bob Schwartz
*Note - This article is copyrighted, but, may be re-published if no changes are made to the content & links. All links must remain active and open in a new window. Author should be noted as San Diego real estate blog & hyper-linked to: http://www.brokerforyou.com/brokerforyou
Subscribe to:
Posts (Atom)
