What to Expect as a Seller During Escrow: Key Points to Know

Selling your home and navigating the escrow process can feel overwhelming, especially if it’s your first time. But don’t worry—Starlight Escrow is here to guide you through every step. Whether you’re wondering what documents you need to provide or how notarization works, we’ve got you covered. Here’s what you can expect as a seller during escrow:

1. Pay for HOA Documents Upfront

See above section Q(12) 1L (2) of a Standard RPA, that seller agrees to pay HOA fee for preparing disclosures. 

You’ll need to provide the Homeowners Association (HOA) documents to the buyer. In California, this is required by law under the California Civil Code, and it’s also part of the accepted offer between you and the buyer. This means you’ll need to pay for these documents before officially selling your home. It’s an upfront cost you can’t avoid, but it’s a standard part of the escrow process. We all hate it, I remember as a first time seller that we had to pay over a thousand dollars to the HOA to obtain some standard documents, we went through it and we hated it too. We even had clients who are attornies to fight it and still ended up paying quite a bit. So do expect to pay upfront.

2. The Escrow Opening Package: A Lot of Paperwork

Once escrow opens, you’ll receive an escrow package, BEFORE BUYERS REMOVE CONTINGENCY, usually about 20 to 30 pages long, filled with important documents. As the seller, you’re required to sign and return these documents within 5 days of receiving them per your contract with the buyer. But escrow usually gives you more time so you have enough time to review. While the amount of paperwork can feel daunting, especially if you’re a first-time seller, Starlight Escrow is here to help you. We aren’t attorneys or tax advisors, so we can’t provide legal or tax advice, but we can explain the documents and guide you through their significance. After you receive your escrow package, feel free to schedule a meeting with us to go over the package.

3. Notarization: Grant Deed and Other Documents

As part of selling your home, you’ll need to notarize certain documents, most importantly the Grant Deed, which officially transfers ownership of the property. Depending on your situation, other documents may also require notarization. Here’s what you need to know:

Who and How much

• The notary public has to be someone approved by the Title Insurance Company. So you will need coordinate with us to either notarize on site in our location of we can send a mobile notary to your location.

• Cost varies depends on the how many signatures are notarized and service provided.

• Typical range of cost is $90-$350.

Timing of Notarization: Before or After Buyer Removes Contingencies?

You can choose to notarize documents either before or after the buyer removes contingencies (conditions that must be met before the sale is finalized). Let’s look at the pros and cons of each option:

Notarizing Before Buyer Removes Contingencies:

• Pros:

  • You won’t need to worry about missing deadlines or delaying escrow.

  • If there are any issues with the notarization, like an unclear stamp, you’ll have time to resolve them without impacting the transaction timeline.

• Cons:

  • You’ll need to pay the notary fee either upfront or at closing, and if the buyer cancels escrow by not removing contingencies, the money you spent on notarization could be wasted.

Notarizing After Buyer Removes Contingencies:

• Pros:

  • You can be confident that the transaction is moving forward, so the money spent on notarization is well spent.

• Cons and PROBLEMS:

  • You maybe in breach of your contract with your buyer. A typical contract says you will need to complete all your escrow paperwork within 5 days. So if you delay signing to after the agreed upon days, you are in breach of your contract. If this is the case, you should have your agent communicate with your buyers regarding the delay.

  • You need to manage your timing carefully. Delays in returning notarized documents could push back the closing date，sometimes with serious consequences. If the original notarized documents aren’t submitted on time, the buyer might issue a "Notice to Perform." Failure to provide the original documents promptly could risk the deal, potentially leading the buyer to back out and claim their deposit.

  • If the buyer relies on your original Grant Deed to close escrow, delays could jeopardize their loan qualification, leading to serious legal and financial complications.

• Always ensure you know your timeline and return original documents to escrow on time. This allows your title company enough time to review everything.

Final Thoughts

The escrow process involves many steps and documents, but with the right guidance, it doesn’t have to be stressful. At Starlight Escrow, we are here to help you navigate every step. While we can’t offer legal or tax advice, we’ll walk you through the documents and ensure you know what to expect. Our goal is to make the process as smooth as possible for you.

DISCLAIMER:

The content provided in this blog is for educational purposes only and should not be considered legal or professional advice. Starlight Escrow does not assume any liability for any actions taken based on the information provided here. For specific guidance related to your situation, please consult a qualified professional.