During escrow for a residential property in Pasadena, the buyer and seller provide separate, conflicting escrow instructions regarding who pays for the home warranty. The escrow officer notices the discrepancy. Under California escrow law, what should the escrow officer do?
Correct Answer
D) Notify both parties of the conflict and refuse to proceed on that item until they reach a mutual agreement
Under California escrow law, the escrow officer must follow only mutually agreed-upon instructions. When conflicting instructions are received, the escrow officer cannot independently resolve the dispute. The officer must notify both parties of the discrepancy and wait for mutual instructions before proceeding. The escrow holder has a fiduciary duty to both parties and cannot favor one over the other.
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Under California law, which of the following best describes the legal role of an escrow holder in a real estate transaction?
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A property in San Jose, California, sells for $750,000. The buyer obtains a conventional loan for 80% of the purchase price. The lender charges a 1.5% loan origination fee. What is the total loan origination fee the buyer must pay at closing?