Escrow in Hawaii is a confidential and impartial third party, who will be responsible for holding the money and documents in safekeeping until it has been determine that all conditions have been satisfied. When it comes to real estate in Hawaii, escrow will follow the original sales contract also known as the purchase contract.
The escrow company is responsible for following and maintaining several duties. These include: receiving and holding deposits, ordering title searches and conveyance documents, clearing title, making pay-offs to existing lenders, providing a settlement statement, handling closings with buyers and sellers, recording documents, and disbursing all funds when the conditions of the purchase contract have been fulfilled.
The escrow is necessary to handle transactions to be conveyed from seller to buyer. This process begins with the signing of the purchase contract and continues until closing. At this time the buyer will take the title to the property. The normal time for this process is three weeks, but it can take up to two months if the buyer is acquiring finance through a mortgage lender or has a number of other issues.
An escrow officer in Hawaii is responsible for tending to every detail until the transaction takes place and closes. This third party will represent neither the buyer nor seller, and will work to meet both parties needs until the completion of the transaction.
There are a number of guidelines that will have to be followed during an escrow transaction. The Hawaii real estate agent will deliver an original purchase contract to the escrow officer to open escrow. The escrow officer will then review the contract and address any questions or errors. An escrow file will then be opened and assigned an escrow number.
Next, the escrow will request a title search from the title department, and this should be completed within three business days. The instructions to the escrow are then prepared and sent to the seller and buyer for their signatures. The instructions will also be delivered to the realtors involved.
After that, escrow will submit requests to lenders for current mortgages on the subject property. The pay-off figures must be obtained because escrow will have to pay off all mortgages.
Once escrow has obtained the title search, they will be able to determine if there are any defects, additional liens, or mortgages that were not disclosed in the purchase contract. It is possible that additional demands could be requested from creditors. The escrow will also review contingencies specified in the purchase contract and financing requirements.
The escrow will then order conveyance documents from a local attorney. Demands, documents, the purchase contract, and any special conditions will be reviewed and updated where necessary. Closing statements should then be prepared and closing appointments will be made. The buyer and agent will be notified of the amount due at the time of the closing.
Then all necessary documents will be forwarded to the Recording Department for the actual recordation of the documents at the Bureau of Conveyances of the State of Hawaii. This should occur within two days after the signing. The Recording Department will notify escrow when the documents have been recorded. This will allow escrow to disburse all funds. This can include seller’s proceeds, mortgage pay-offs, and real estate agent’s commissions.
Escrow will then notify the agent that the transactions have been completed. They should then forward all final documents to the necessary parties such as buyers, sellers, lenders, and anyone else of interest.