Guide · Buying a home
The home buyer’s guide to escrow
As the buyer, you have four jobs in escrow: send your deposit on time, read the disclosures and reports you get, sign your loan papers in front of a notary, and send the rest of your money safely. Escrow holds the money until every condition in the signed instructions is met. Then the sale closes.
What does escrow do for a buyer?
Escrow is the neutral middle of your purchase. You and the seller sign one set of written instructions. Escrow holds your deposit, your loan money and the signed papers until everything in those instructions has happened. California law says a third party keeps what one side hands over until a set condition is met, then delivers it (Financial Code §17003).
Escrow doesn’t work for you or for the seller. It won’t negotiate for you or tell you what to sign, and legal or tax advice isn’t part of its job. Your agent and your lender guide you, and an attorney can too.
Your part, step by step
Your purchase contract sets the timing. Most escrows follow this order.
Step 1: Send your deposit
Your contract says how much the deposit is and when it’s due. You pay it to escrow. The seller never holds it. Before you wire it, call us at (714) 544-6525 and check the wiring details by phone.
Step 2: Sign the escrow instructions
We turn your contract into written instructions: the price, the loan terms, the deadlines and which side pays each cost. Compare them with your contract, line by line. If anything looks different, ask your agent before you sign. Any change later needs your signature and the seller’s.
Step 3: Read the disclosures and the title report
For most home sales, the seller gives you a Transfer Disclosure Statement about the home’s condition. If it reaches you after you sign your offer, you can cancel in writing within 3 days, or 5 days when it comes by mail or electronically (Civil Code §1102.3). The title company’s preliminary report shows who owns the home and any loans or liens (debts tied to the home) on record. If the home is in a homeowners association (HOA), the seller also gives you the HOA’s rules and a statement of its dues (Civil Code §4525).
Step 4: Finish your loan
Your lender orders the appraisal and approves the loan. At least three business days before you close, the lender must give you a Closing Disclosure with your final loan terms and costs, says the Consumer Financial Protection Bureau (CFPB). Compare it with your Loan Estimate, and ask your lender about anything that changed.
Step 5: Sign in front of a notary
You sign your loan papers and your escrow papers before a notary public. Bring a current photo ID, such as a California driver’s license or a U.S. passport.
Step 6: Send the rest of your money
Before closing, escrow tells you the exact amount to send: your down payment and closing costs, less your deposit and any credits. Call us at (714) 544-6525 and confirm the wiring details by phone first. Never wire money on the word of an email or a text alone.
Step 7: Funding and recording
Your lender wires the loan money to escrow. Then the county recorder records the deed, and you become the owner of record. Escrow pays off the seller’s loans, pays the seller and sends you a final closing statement. The keys come from your agent, not from escrow.
What will I pay at closing?
Your contract decides who pays which cost (California Department of Real Estate). Besides our escrow fee, these are the lines buyers see most often. Your Closing Disclosure and our closing statement show the real numbers.
| Cost | Who sets it | What to expect |
|---|---|---|
| Lender’s title policy | The title company | Usually the buyer’s cost. The title company quotes it. |
| Loan costs | Your lender | On your Loan Estimate, then on your Closing Disclosure |
| Recording fees | The county | Set by the county recorder where the home is |
For a quote on our escrow fee, call us at (714) 544-6525.
What should I have ready?
Keep these close at hand. Your escrow officer will ask for anything else.
For escrow
- A current photo ID for signing
- Your deposit, on the date in your contract
- Your lender’s name and your loan officer’s phone number
- How you’ll take title, meaning how your name goes on the deed. Ask an attorney or a tax adviser which way suits you.
For your lender
- Every paper your loan officer asks for, sent quickly
- Proof of homeowners insurance before closing
What comes after closing?
Watch for a supplemental property tax bill. California revalues a home when it changes owners, so you may get one or two extra tax bills after you buy. They come to you, not to your lender, even if your lender pays your regular taxes from an impound account (a monthly set-aside for taxes and insurance). You pay them to the county tax collector yourself (Civil Code §1102.6c).
Keep your final closing statement with your records. Your tax adviser may ask for it.
How Alliance Mutual Escrow helps buyers
Your escrow officer coordinates the title company, your lender and the agents. We tell you what we still need from you, and by when.
Every dollar shows up on your closing statement, line by line.
Questions buyers ask
Can I cancel after I get the seller’s disclosure statement?
Sometimes. If the Transfer Disclosure Statement reaches you after you signed your offer, you can cancel by written notice within 3 days of getting it in person, or 5 days when it comes by mail or electronically (Civil Code §1102.3). Any other way out, like a loan or inspection contingency, comes from your contract, so ask your agent.
When will I see my final loan costs?
At least three business days before you close. That’s when your lender must give you the Closing Disclosure, with your loan terms, your monthly payment and your closing costs. Compare it with the Loan Estimate you got earlier (Consumer Financial Protection Bureau).
What ID do I need to sign my loan papers?
A photo ID that is current or was issued in the last five years, such as a California driver’s license or ID card, or a U.S. passport. Some others work too, like another state’s driver’s license or a U.S. military ID. The notary has to be satisfied you’re the person named in the papers (Civil Code §1185).
Why did I get another property tax bill after I bought my home?
It’s probably a supplemental bill. California revalues a home when it changes owners, and you may get one or two supplemental bills. They aren’t sent to your lender, even if you have an impound account, so you pay them to the county tax collector yourself (Civil Code §1102.6c).
Sources and fine print
- Cal. Financial Code §17003 (the legal definition of escrow)
- Cal. Civil Code §1102.3 (when the disclosure is due, and the right to cancel)
- Cal. Civil Code §4525 (HOA documents for the buyer)
- Cal. Civil Code §1185 (ID for a notarized signature)
- Cal. Civil Code §1102.6c (supplemental tax bill notice)
- CFPB: What is a Closing Disclosure?
- California Department of Real Estate: Escrow, information for consumers
Sources checked September 2026. Page updated . General information, not legal or tax advice.