Title & Escrow

What is Escrow & Title?

Escrow is a critical part of a real estate transaction in which the Buyer and Seller select a neutral third party—usually an escrow company or title company—to securely hold funds, documents, and instructions until all terms of the sale have been satisfied. Escrow protects both parties by ensuring that no money or property changes hands until everything outlined in the purchase agreement is completed.

How does it work?

Once you are ready to buy or sell a home, an escrow account is opened and the following steps typically take place:

  • Agreement and Deposit: The Buyer and Seller agree to the terms of the sale and the offer is formally accepted. The Buyer then submits an earnest money deposit to the escrow holder, demonstrating good faith and commitment to the transaction.

  • Loan and Appraisal (if applicable): If the Buyer is obtaining financing, the lender orders an appraisal to confirm the property’s value meets the loan requirements. During this time, the Buyer also completes the loan application and submits required financial documentation.

  • Inspections and Due Diligence: The Buyer schedules property inspections to evaluate the condition of the home. If repairs, credits, or concessions are requested, these items are negotiated between the Buyer and Seller and documented through written agreements.

  • Title Review and Disclosures: The escrow or title company reviews the property’s title to ensure clear ownership and identifies any liens, easements, or other matters that must be resolved before closing. Required disclosures are provided and reviewed by the Buyer.

  • Final Approval and Closing Preparation: Once inspections are completed, repairs (if agreed upon) are addressed, and the Buyer’s loan receives final approval, escrow prepares the final settlement statement outlining all costs and credits for both parties.

  • Close of Escrow: Prior to closing, the Buyer deposits the remaining funds needed to complete the purchase. The escrow holder then records the necessary documents, disburses funds according to the escrow instructions, pays off any outstanding obligations, and releases the net proceeds to the Seller.

Escrow officially closes once all documents are recorded and funds have been properly distributed, at which point ownership of the property is transferred to the Buyer.

Who holds the escrow?

Below is a great resource for our local title companies we’ve worked with in the past for Buyers and Sellers in their transactions:

  • Chicago Title Company is a major national provider of title insurance, escrow, and closing services in residential and commercial real estate.
    401 Penninsula Drive, Suite 11
    Lake Almanor, CA 96137
    Ph: (530) 816-7055
  • Cal-Sierra Title Company is locally owned, having been in business since 1962.
    7597 Highway 89, Suite 5 (Courier)
    P.O. Box 424 (US Mail)
    Graeagle, CA 96103
    Ph: (530) 836-0700

FEES: WHO PAYS WHAT?

In Plumas County, it is customary for the Buyer and Seller to share escrow and title-related fees equally (50/50). While the fee allocations outlined below reflect standard local practice, all fees are negotiable and may be adjusted through offers and counteroffers by either party.

Typical Fee Allocation:

  • Recording Fees (Grant Deed): Typically paid by Buyer

  • Recording Fees (Deed of Trust): Typically paid by Buyer

  • Buyer’s Title Insurance Policy: Typically split 50% Buyer / 50% Seller

  • Escrow Fees: Typically split 50% Buyer / 50% Seller

  • Plumas County Transfer Tax: Typically paid by Seller at $1.10 per $1,000 of the purchase price

  • City Transfer Tax: Not applicable in all areas

  • Private Transfer Fees (if applicable): Typically paid by Buyer

Additional Costs to Consider:

  • Property Inspections: Typically paid by Buyer

  • Re-inspections: Typically paid by Buyer

  • Natural Hazard Disclosure Report: Typically paid by Seller

  • Contractually Negotiated Repairs: Typically paid by Seller (or shared, as negotiated)

  • Purchase Credits: Paid by Seller

  • Prorations (Property Taxes, HOA Dues, etc.): Paid by Seller

  • Outstanding Property Liens: Paid by Seller

Please note that if the property involved is a bank-owned foreclosure or a short sale, certain fees and expenses may differ from the above and are subject to negotiation among all parties.