In a Sale
What This Means When the House Is Being Sold
Escrow is where the paperwork requirements of an estate sale actually get enforced. It is the party that will not accept a photocopy of Letters, that asks for a certification of trust before a trustee can sign, and that holds closing until a confirmation order is in hand where one is required. Nothing about escrow's role changes for an estate, but the list of documents it needs before it will act gets considerably longer.
Timing is where families get caught off guard, since a standard thirty day close does not account for a confirmation hearing that has not been scheduled, or a certified copy that has not yet been ordered.
Sale proceeds generally do not go straight to the family at closing either. They are wired to the estate or trust account, and distribution to individuals happens later, through the estate's own process.
Sequence
What Usually Happens
- 1Escrow is opened once a purchase agreement is signed
- 2Escrow requests proof of authority: Letters, a trust certification, or an order
- 3Contingencies are cleared, including any court confirmation requirement
- 4Funds and the deed are exchanged at closing
- 5Proceeds are wired to the estate or trust account rather than to individuals
Compare
Not to Be Confused With
- This TermEscrow
- Often Mistaken ForBlocked Account
- Often Mistaken ForTitle Insurance
- Often Mistaken ForOrder Confirming Sale
What Tells Them Apart
Escrow is the process and the account holding funds and documents during a transaction. A blocked account is a different, court-ordered restriction sometimes placed on proceeds after they leave escrow. Title insurance is a policy issued in connection with the closing rather than a place funds are held. An order confirming sale is a document escrow may need before it can close.
Questions
Questions People Ask
Why is escrow slower on an estate sale?
Escrow generally requires proof of legal authority before it will act, such as certified Letters or a trust certification, and it may need to wait on a court confirmation order if the sale requires one. An escrow officer experienced with probate and trust sales tends to build these steps into the timeline from the start.
Where do estate sale proceeds go after closing?
Typically to the estate's or trust's own account, not directly to individual heirs or beneficiaries. Distribution to individuals happens afterward through the estate's own process, often only after creditor claims are resolved and any required court accounting has been reviewed and approved.
What documents does escrow need to close an estate sale?
Commonly certified copies of Letters or a court order, a trust certification if a trust is involved, and any required confirmation order. Requirements vary by transaction, and an experienced escrow officer will provide a specific list early rather than discovering gaps near the closing date.