Question: Why can’t escrow sign seller(s) far in advance of the closing date when they have buyers obtaining financing on their sale?
Answer: Because the Statutory Warranty Deed (the Deed involved in most sales) reflects not just the sellers but also how the buyers are taking title to the property. This is called Vesting. Escrow needs to verify and make sure vesting is correct. In most cases, Escrow needs to view the lender’s loan documents to prepare the Deed for the seller to sign. In other words, the lender is preparing their documents with the buyers names reflected on the Deed of Trust and other documents. This shows escrow how the lender has the buyer acquiring title. However, the lender documents may conflict with the purchase and sale agreement. Sometimes lenders do not follow the purchase and sale agreement with how the buyers names are reflected or spelled. That means escrow informs the lender their loan docs need correction. All that to say…..there is a reason escrow does not sign sellers weeks in advance of the closing date.
– Good luck out there! – Tim Kane, Owner – Legacy Escrow Service, Inc.