Aloha, George Krischke with Honolulu HI 5 (company now called Hawaii Living).
Today we’re going to talk about closing of escrow. In a different segment we talked about contingencies in a contract. Those are conditions that need to be satisfied or events that need to take place before a party is obligated to move forward with the contract.
Once all contingencies are satisfied, or removed, means buyer, and seller have fulfilled all conditions of the contract, that’s when we set up the signing for the buyer, and the seller to sign all escrow closing documents. That includes the conveyance document which is the deed, and it may include loan documents that the buyer may have to sign.
Besides the signing, and getting the documents notarized all the funds need to be in escrow, and this is the peculiar thing in Hawaii. Hawaii is a good funds state, that means that all funds need to be received by escrow no later than two business days prior to recordation, prior to closing.
Now that may be different in your state, but that’s they way it’s in Hawaii. So signing, and funds need to be with escrow, need to be completed two business days prior to recordation.
Now what does it mean, good funds? It means escrow will have to have the funds, and they need to be, they need to have cleared, means if the buyer brings in his last deposit with a personal check that’s no good. It needs to be a cashiers check, or it needs to be a wire, and the lender usually wires the funds in. So it needs to be good funds received by escrow.
Now once all escrow closing documents are signed, and all deposits are deposited with escrow two business days prior to recordation, escrow will review the file, and take it to the Bureau of Conveyance by the next business day which is one day prior to recordation.
The Bureau of Conveyances reviews the file, makes sure that everything is proper, and the following day the transaction gets recorded. So that’s the day of closing, or recordation.
On the actual day of recordation, the conveyance document gets time stamped, and they all get the same stamp it’s 8:01 A.M. in the morning, and that’s when it gets recorded.
Now we don’t actually get the confirmation that it has recorded, and they, they don’t all get stamped at 8:01, but they receive the same stamp. So sometimes shortly after 8:00 in the morning, or 8:01 A.M. in the morning, we usually get a phone call from, from the escrow company that the transaction has successfully recorded, or closed.
And that phone call may not come until 10:00, or sometimes 11:00, or sometimes close to 12 noon. But when we get recordation clearance, when we get that phone call that’s when everything is done. Escrow will disperse the funds, they close the file, they may pay any remaining balances, any remaining invoices that were supposed to be paid through escrow, and the buyer is entitled to the keys, and the seller is entitled to the sales proceeds.
Now getting the keys, I need to just talk a little bit about that. Sometimes buyers think well they get the keys at 8:00 in the morning, but we still have to wait until recordation clearance. So if you schedule, if you’re the buyer, and you schedule some service provider, or the movers for 8:00 in the morning, we may not have the keys yet. The seller may not provide us with the keys until we have recordation clearance. So make sure to schedule any service appointments until we have recordation clearance, usually before 12:00.
And that’s it for today. Thanks for watching, until next time. ~Aloha