In a typical California residential real estate transaction, when does escrow officially 'close'?
Correct Answer
B) When all conditions are met, documents are recorded, and funds are disbursed
In California, escrow officially closes when all conditions of the escrow instructions have been met, the deed and deed of trust are recorded at the county recorder's office, and the escrow officer disburses all funds to the appropriate parties. Recording of the deed is the key event that marks the official closing in California.
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Related Topics & Key Terms
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Related Concepts
Escrow is an arrangement in which a neutral third party holds documents, funds, or other items on behalf of the buyer and seller until all conditions of the transaction are met.
A general warranty deed provides the greatest protection to the grantee by guaranteeing that the grantor holds clear title and has the right to sell the property. It includes covenants that protect against all defects in title, even those arising before the grantor owned the property.
Intestate succession is the legal process by which a deceased person's property is distributed according to state law when they die without a valid will. State statutes determine the order of inheritance.
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- → A buyer records a deed at the county recorder's office. What is the primary purpose of recording?
- → A buyer drives past the property and sees someone other than the seller living there and maintaining the yard. This observation should put the buyer on what type of notice?
- → In a covered purchase transaction, the borrower receives a final form showing the loan terms, cash to close, and settlement charges shortly before consummation. What form is this?
- → Along with the signed offer, Quinn Brooks delivers a check to demonstrate serious intent to complete the transaction if the offer is accepted. What is this deposit called?
- → On a settlement statement, the buyer's earnest money reduces the remaining cash needed to close. How is that item characterized?
- → On a settlement statement, an item increases the buyer's amount due at closing. How is that item characterized?
- → On the seller's settlement statement, the purchase price of $400,000 appears as what?
- → At closing, the purchase price of $350,000 appears on the buyer's side of the settlement statement. Is this amount a debit or a credit to the buyer?
- → Under TRID rules, the lender must deliver the Closing Disclosure to the borrower at least how many business days before loan consummation?
- → In an escrow closing, the escrow agent discovers that the seller has not yet provided the signed deed. What should the escrow agent do?
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Previous Question
A California seller is paying a 6% total commission on a home that sold for $500,000. The listing agreement specifies a 60/40 split between the listing brokerage and the buyer's brokerage. How much commission does the buyer's brokerage receive?
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A foreign investor (non-U.S. person) sells a California rental property for $800,000. The property carries a mortgage balance of $600,000. The escrow officer calculates that the combined federal FIRPTA withholding (15%) and California state withholding (3.33%) total approximately $146,400, which exceeds the seller's net equity of $200,000 after paying off the mortgage. What is the most appropriate course of action?