How the Escrow Process Works in California

Escrow is a transaction where one party delivers something of value to a neutral third party, to be held until specified conditions are met, then delivered to another party. Both the buyer and seller entrust legal documents and funds to the escrow holder, who transfers them upon close. As a neutral third party, the escrow holder ensures all mutually agreed-upon terms are met before the transaction completes. The escrow officer is not a legal counselor and cannot give legal advice — they must remain neutral and comply with written instructions from all parties.

Step 1: Opening Escrow — Once the buyer and seller have a signed purchase agreement, escrow is opened at a title company like Fidelity National Title. The escrow officer receives the agreement, deposits the buyer's earnest money, and prepares escrow instructions. These instructions define all conditions that must be met before the transaction can close — they represent your written protection and authorize the escrow officer to order title insurance.

Step 2: Title Search — The title company conducts a thorough search of public records to verify ownership and identify any liens, easements, or encumbrances on the property. The findings are summarized in a preliminary title report. Read and understand the prelim — if any item is unclear, contact your escrow officer or title officer immediately.

Step 3: Inspections & Contingencies — The buyer typically has a contingency period to conduct property inspections, review disclosures, and secure financing. Any issues discovered may lead to negotiations or repairs. Communicate all changes to escrow in writing — with rare exceptions, escrow acts only on mutual instructions.

Step 4: Loan Approval & Appraisal — If the buyer is using a mortgage, the lender orders an appraisal and completes underwriting. Once the loan is approved, the lender sends loan documents to escrow for signing. The escrow officer will tell you the exact amount needed and schedule a signing appointment.

Step 5: Signing & Funding — Both parties sign all required documents. Check every signature for accuracy — middle initials, spelling, and vesting must match exactly. Ensure all documents are notarized when applicable, and closing funds are sent by cashier's check or wire. The lender funds the loan directly to escrow.

Step 6: Recording & Closing — The escrow officer submits the deed and mortgage documents to the county recorder's office. Once recorded, ownership officially transfers to the buyer. The escrow officer disburses funds to the seller, agents, and other parties according to the signed instructions. Final documents and closing statements are forwarded to all parties.

Escrow fees are based on the sales price, loan amount, and services required — usually split between buyer and seller per the purchase agreement. In the South Bay and Westside LA, a standard escrow takes 30 to 45 days. Cash transactions may close in as few as 14 days. Team Goeglein's coordination with escrow officers at Fidelity National Title keeps every transaction moving toward an on-time close.