Under California law, which of the following correctly identifies all entities authorized to conduct escrow in a real estate transaction?
Correct Answer
A) Licensed escrow companies, title insurers, banks, savings institutions, attorneys acting in their law practice, and real estate brokers acting as agent or party in the transaction
The Escrow Law, Financial Code section 17000 and following, requires an escrow agent license issued by the Department of Financial Protection and Innovation, and section 17006 lists who may conduct escrow without one: banks, trust companies, savings institutions and insurers, including title insurers; attorneys acting in the course of a law practice and not otherwise in the escrow business; companies whose principal business is title search or abstracting; and brokers licensed by the Real Estate Commissioner performing acts incidental to a transaction in which the broker is an agent or a party. Because the question asks for every authorized entity, a list that omits brokers is incomplete. The broker exemption is narrow: it reaches only the broker's own transactions, and a broker may not hold out to the public as an escrow business.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Marketable title is title that is free from reasonable doubt as to who the owner is and free from liens, encumbrances, or defects that would cause a reasonable buyer to hesitate before purchasing. It is also known as merchantable title.
Probate is the legal process by which a deceased person's will is validated by the court and their estate is administered, including the transfer of real property to the named beneficiaries or heirs.
A quitclaim deed transfers whatever interest the grantor may have in a property without making any warranties or guarantees about the quality of title. It offers the least protection to the grantee.
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Previous Question
A California property is sold for $1,200,000. The seller has an existing mortgage balance of $450,000. The seller agreed to pay a 5% commission to the listing brokerage, which splits 50/50 with the buyer's brokerage. What are the seller's approximate net proceeds from the sale, before considering closing costs, taxes, and other fees?
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A buyer is purchasing a home in San Diego for $650,000. The buyer is putting 20% down and obtaining a 30-year fixed mortgage at 6.5% annual interest. The lender requires the buyer to prepay the first month's interest at closing. What is the prepaid interest amount for one month?