CONTEMPO ESCROW, INC
411 East Huntington Drive, Suite 101B, Arcadia, CA 91006
Office: (626) 446-2401 • Fax: (626) 446-2362
SALE ESCROW INSTRUCTIONS AND GENERAL PROVISIONS
ESCROW OFFICER: [Escrow Officer] ESCROW NO: [Escrow No]
CONTEMPO ESCROW, INC., IS LICENSED AS AN ESCROW AGENT BY THE DEPARTMENT OF FINANCIAL PROTECTION AND INNOVATION, LICENSE NUMBER 963-2365.
[BUYER] (BUYER) AND [SELLER] (SELLER) HAND CONTEMPO ESCROW, INC., (ESCROW HOLDER) A COPY OF THE RESIDENTIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS DATED [DATE] INCLUDING [NUMBER OF COUNTER OFFERS] COUNTER OFFER(S) AND BUYER’S INSPECTION ADVISORY. ESCROW HOLDER’S DUTIES AND RESPONSIBILITIES ARE LIMITED TO THOSE PARAGRAPHS SPECIFIED IN PARAGRAPH 20 of the C.A.R. RESIDENTIAL PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS. OTHER TERMS AND CONDITIONS OF THE AGREEMENT ARE OUTSIDE THE SCOPE OF ESCROW HOLDER’S DUTIES AND ESCROW HOLDER SHALL NOT BE FURTHER CONCERNED AND/OR LIABLE.
TERMS OF TRANSACTION
Buyer will hand Escrow Holder the initial deposit in the amount of……………………………………………………………………………………. $[Amount]
Prior to close of escrow, Buyer will deposit an additional amount of ………………………………………………………………………………… $[Amount]
Buyer to obtain a New first trust deed loan in the amount of …………………………………………………………………………………………….. $[Amount]
Buyer to obtain a New second trust deed loan in the amount of ………………………………………………………………………………………. $[Amount]
TOTAL CONSIDERATION ……………………………………………………………………………………………………………………………………………… $[Amount]
Buyer and Seller will deliver to Escrow Holder any instruments which this escrow transaction requires which shall be executed as necessary, all of which Escrow Holder is instructed to use provided that on or before [Date] Escrow Holder holds a policy of title insurance through [Title Company] with the usual company exceptions, with a liability amount of [Policy Amount] covering property:
APN AND LEGAL DESCRIPTION TO BE PROVIDED BY TITLE COMPANY AND BE APPROVED IN WRITING BY BUYER AND SELLER PRIOR TO CLOSE OF ESCROW
PROPERTY ADDRESS: [Property Address]
SHOWING TITLE VESTED IN: [Buyer] (Complete Vesting to Follow)
FREE FROM ENCUMBRANCES EXCEPT:
- All General and Special Taxes for the current year, including bonds, special assessments and/or supplemental taxes assessed pursuant to the provisions of Chapter 3.5, commencing with Section 75 of the Revenue and Taxation Code of the State of California.
- Covenants, conditions, restrictions, reservations, rights, rights of way, and easements, and any oil, gas, or mineral reservations now of record, if any.
- First Deed of Trust to record securing a note in the amount of [Loan Amount].
- Second Deed of Trust to record securing a note in the amount of [Loan Amount].
INSTRUCTIONS TO ESCROW HOLDER:
- AFFILIATED BUSINESS AND CALIFORNIA CODE OF REGULATIONS TITLE 10, § 1740.1 DISCLOSURE: The Parties have been advised by this disclosure that stockholders of Escrow Holder are also the owners of [Affiliated Company] and may receive a financial benefit as shareholders as a result of the handling of this escrow transaction.
- HOLD OPEN FEE: Notwithstanding any other provision of these Escrow Instructions, the Parties agree and acknowledge that where a postponement or cancellation of this Escrow result from acts or omissions of the Parties, Escrow Holder shall be entitled to a charge for administering an Escrow where the postponement is for at least two months from the most recent closing date agreed upon in writing by the Parties in this Escrow or if the Escrow is canceled. The Parties agree that Escrow Holder is authorized, in its sole discretion and without further instruction, to deduct and pay to Escrow Holder a hold open administration fee of [Amount] dollars [($xx.xx)] per month from the funds on deposit with Escrow Holder. On demand, the Parties, jointly and severally, agree to deposit such additional funds as may be necessary to cover Escrow Holder’s hold open administration fee if the same is necessary.
Seller’s Initials (________)(________) Buyer’s Initials (________) (________)
- CONFLICTS WITH PURCHASE AGREEMENT: The instructions contained herein do not supersede the instructions contained in the Residential Purchase Agreement and Joint Escrow Instructions entered into between the Parties and are void if in conflict with the Residential Purchase Agreement and Joint Escrow Instructions. Notwithstanding the foregoing, the Parties agree to execute these instructions and any supplemental instructions presented by Escrow Holder confirming their agreement to be bound to any additional terms and conditions of Escrow Holder, including Escrow Holder’s general provisions, and authorize Escrow Holder to resign from processing this escrow transaction if mutual agreement cannot be reached between the Parties and Escrow Holder relative to the terms of conditions of Escrow Holder’s duty.
- NATURAL HAZARD ZONE DISCLOSURE REPORTS: Seller to provide Buyer with a Natural Hazard Zone Disclosure Report and Escrow Holder is hereby authorized and instructed to debit Seller with the cost of same, as per billing if deposited into escrow.
- HOME PROTECTION PLAN: Seller to provide Buyer with a one-year Home Protection Plan for subject property including [items included] and hereby authorizes Escrow Holder to pay for same, the cost of which is not to exceed $[Amount], as per billing if deposited into escrow. In the event the premium exceeds same, Escrow Holder is authorized and instructed to charge account of Buyer with any additional monies due.
- HOMEOWNERS’ ASSOCIATION: Escrow Holder is instructed to obtain a statement of fees from the Homeowners’ Association (“Association”) affecting subject property and to charge the [Buyer/Seller] with any transfer fee as demanded by said Association. Seller shall furnish Buyer with a copy of all documents required to be delivered by Seller pursuant to Civil Code § 4525. Escrow Holder is instructed to obtain said documents from the Association. Seller shall be charged the cost for preparation of documents required by Civil Code § 4525. [Buyer/Seller] will be charged the cost for preparation of any documents not required by Civil Code § 4525. ANY ID CARDS OR KEYS (POOL KEY, REC. KEY, ETC.) ARE TO BE HANDED TO THE BUYER DIRECTLY BY SELLER OUTSIDE OF THIS ESCROW, AND IT WILL BE THE BUYER’S FULL RESPONSIBILITY IN OBTAINING SAME. IN THE EVENT THE SELLER IS UNABLE TO PROVIDE THE KEYS/CARDS (IF ANY) TO THE BUYER. IT WILL BE THE SELLER’S RESPONSIBILITY FOR THE COST AND/OR REPLACEMENT OF SAME OUTSIDE OF THIS ESCROW AND THE ESCROW HOLDER WILL ASSUME NO LIABILITY IN CONNECTION WITH SAME REGARDLESS OF THE HOMEOWNER ASSOCIATION(S) DEMAND LETTER SUBMITTED IN ESCROW.
- DEPOSIT OF FUNDS: Escrow Holder is instructed to deposit all funds received by Escrow Holder with any state or national bank in a trust account in the name of Escrow Holder, without any liability for payment of interest. All deposits made by personal check, cashier’s check, certified check, or deposit other than cash or wire transfer are subject to clearance and payment by the financial institution upon which they are drawn. Funds deposited with Escrow Holder in the form of check, draft, or similar instrument will be identified as collected funds when the Escrow Holder’s financial institution confirms that the funds are available for disbursement.
- GOOD FUNDS LAW: Pursuant to California Insurance Code Section 12413.1, known as the Good Funds Law, the parties hereto are made aware that closing funds deposited by the parties and/or lender must be cleared funds prior to close of escrow. This law places some very specific constraints upon the time frames for funds to be made available for disbursement. Close of escrow cannot occur before funds are cleared and immediately collectible and available for withdrawal, which clearance can range from being immediately available upon receipt to seven (7) days depending on the form deposit. Buyer and Seller hereby release Escrow Holder of any responsibility, claim, and/or liability in connection with such a delay caused by the manner in which closing funds or lender’s funds are deposited.
TO COMPLY WITH THE GOOD FUNDS LAW ESCROW HOLDER REQUIRES THAT CLOSING FUNDS BE DEPOSITED VIA CASHIER’S CHECK DRAWN ON A BANK WITH CLEARING HOUSE IN THE STATE OF CALIFORNIA OR WIRE AT LEAST TWO (2) BUSINESS DAYS PRIOR TO RECORDING OF DOCUMENTS.
- AGREEMENT TO BE BOUND BY GENERAL PROVISIONS: By executing these General Provisions and any Supplemental Instructions presented by Escrow Holder, the Parties agree to be bound to all terms and conditions of Escrow Holder, including those stated in these General Provisions, and authorize Escrow Holder to resign from processing this escrow transaction if an agreement cannot be reached among the Parties and Escrow Holder concerning the terms and conditions of Escrow Holder’s duty. THESE ESCROW INSTRUCTIONS ARE NOT INTENDED TO SUPERSEDE THE REAL ESTATE PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS, BUT TO CARRY OUT ITS TERMS AND CONDITIONS IN CONSUMMATING THIS PURCHASE AND SALE, EXCEPT AS MAY BE AMENDED OR MODIFIED BY THE MUTUAL WRITTEN INSTRUCTIONS OF THE PARTIES.
- COMMENCEMENT OF ESCROW HOLDER DUTY: This escrow transaction is deemed open, and Escrow Holder’s duty commences, upon receipt of mutual or matching escrow instructions, signed by all Parties, and receipt of the initial, good faith deposit by Escrow Holder. The escrow instructions shall be incorporated in the purchase agreement or, if the purchase agreement does not include escrow instructions or no purchase agreement is entered into by the Parties, shall be drafted by Escrow Holder at the direction of the Parties.
- DUTIES OF ESCROW HOLDER: The Parties agree that Escrow Holder has only those duties inherent of an escrow service provider. There is no other legal relationship between Escrow Holder and the Parties created by this escrow transaction. Escrow Holder’s duties are limited to the safekeeping of money and documents received by Escrow Holder and for the disposition and/or disbursement of same in accordance with the written instructions accepted by Escrow Holder in this escrow transaction. Escrow Holder shall not be liable for any damages, losses, costs, or expenses incurred by any Party in the handling and processing of this escrow transaction as a result of any act or failure to act made or omitted in good faith or for any action taken that Escrow Holder shall in good faith believe to be genuine, excepting such as may arise through or be caused by Escrow Holder’s willful neglect or gross misconduct.
- PROMISE TO PAY AND INDEMNIFY: The Parties jointly and severally promise and agree to pay promptly on demand, as well as to indemnify Escrow Holder and hold Escrow Holder harmless from and against all litigation and interpleader costs, damages, judgments, attorney’s fees, expenses, obligations, and liability of every kind which in good faith Escrow Holder may incur or suffer in relation to or arising out of this escrow transaction, whether litigation, interpleader, obligation, liability or expense arises during the performance of this escrow transaction or subsequently, directly or indirectly. The Parties shall pay Escrow Holder a reasonable fee for all time spent by officers or employees of Escrow Holder for dispute resolution action concerning this escrow transaction including but not limited to time spent researching, reviewing and/or testifying relative thereto.
- ATTORNEY’S FEES: IF ESCROW HOLDER IS REQUIRED TO RESPOND TO ANY LEGAL SUMMONS OR PROCEEDING OR IF ANY ACTION IN INTERPLEADER OR DECLARATORY RELIEF IS BROUGHT BY OR AGAINST ESCROW HOLDER, THE PARTIES JOINTLY AND SEVERALLY AGREE TO PAY ALL COSTS, EXPENSES AND REASONABLE ATTORNEY’S FEES EXPENDED OR INCURRED BY ESCROW HOLDER. A LIEN IS CREATED IN ESCROW HOLDER’S FAVOR UPON ALL RIGHTS, TITLES, AND INTEREST, OF THE PARTIES AND ALL ESCROW PAPERS AND OTHER PROPERTY AND MONIES DEPOSITED WITH ESCROW HOLDER.
IF ANY PARTY TO THIS ESCROW TRANSACTION, OR ESCROW HOLDER, INSTITUTES OR DEFENDS ANY LITIGATION RELATING TO OR ARISING OUT OF THIS ESCROW TRANSACTION, AT LAW OR IN EQUITY, THE PREVAILING PARTY, AS DETERMINED BY THE COURT, SHALL, IN ADDITION TO SUCH OTHER RELIEF AS MAY BE AWARDED, BE ENTITLED TO RECOVER REASONABLE ATTORNEYS’ FEES, COSTS, AND EXPENSES OF SUCH LITIGATION.
- UNJUST ENRICHMENT: In the event any Party to this escrow transaction received funds or is credited funds to which they are not entitled, that Party shall, upon written demand, return the funds immediately to escrow for correct disbursement.
- DISCLOSURE OF POSSIBLE BENEFITS TO ESCROW HOLDER: Because Escrow Holder maintains its general escrow accounts, special accounts and trust accounts with depositories, Escrow Holder may receive certain financial benefits such as bank services, accommodations, interest income, loans or other business transactions from the depositories (“collateral benefits”). All collateral benefits shall accrue to the sole benefit of Escrow Holder and Escrow Holder shall have no obligation to account to the Parties for the value of any such collateral benefits. These benefits shall be treated as additional compensation to escrow holder for its services in this transaction.
- RELEASE OF FUNDS: If the Parties instruct Escrow Holder to release funds prior to close of escrow, regardless of the status of the escrow transaction or recordation of documents, the Parties release, relieve, indemnify and agree to hold harmless Escrow Holder from any liability and/or responsibility, including any legal actions, attorney’s fees, costs or claims, arising out of or relating to Escrow Holder’s compliance with those instructions, and Escrow Holder shall not be responsible to recover those funds if the escrow transaction is not consummated.
- COSTS AND CHARGES: From funds due Seller at the close of escrow, deduct and pay encumbrances of record, plus accrued interest, charges and prepayment penalties, if any, bonds and/or assessments, and any delinquent monthly installment(s) on existing encumbrance(s) as disclosed by beneficiary statement(s), and any county and/or city transfer fees, costs and charges in this transaction which may include, but are not limited to: the Owner’s Policy of title insurance, documentary transfer tax, reconveyance fees, recording fee’s, Seller’s customary escrow fees, fees for preparation, notarization and recording of documents as necessary on Seller’s behalf, wire fees, messenger and overnight delivery fees, Seller’s portion of the sub-escrow fee, and Broker compensation as per separate agreement.
Buyer agrees to pay all Buyer’s usual costs and charges in this transaction which may include, but are not limited to: Buyer’s customary escrow fees, document preparation fees, email document fees, wire fees, messenger and overnight delivery fees, all fees and charges relating to new loan(s), Buyer’s portion of the sub-escrow fee, recording charges, and inspection fees.
- STATUTE OF LIMITATIONS: The instructions contained in these General Provisions and any supplemental instructions shall be construed and interpreted according to California Law. NO ACTION SHALL LIE AGAINST ESCROW HOLDER FOR ANY CLAIM, LOSS, LIABILITY OR ALLEGED CAUSE OF ACTION OF ANY KIND OR NATURE WHATSOEVER, HOWEVER CAUSED OR OCCURRED, IN THIS ESCROW TRANSACTION OR IN CONNECTION WITH THE HANDLING OR PROCESSING OF THIS ESCROW TRANSACTION, UNLESS BROUGHT WITHIN TWELVE (12) MONTHS AFTER THE CLOSE OF ESCROW OR ANY CANCELLATION OR TERMINATION OF ESCROW FOR ANY REASON WHATSOEVER.
- WRITTEN INSTRUCTIONS REQUIRED: Pursuant to California Civil Code Section 1624, no notice, demand, supplemental escrow instruction, or amendment of the escrow instructions (collectively “supplemental instructions”) shall be effective, and Escrow Holder shall not act upon or consider such supplemental instruction valid unless given in writing, fully executed by the affected Parties and received by Escrow Holder.
- AUTHORIZATION TO ACCEPT ELECTRONIC SIGNATURES AND DOCUMENTS: In accordance with California’s Uniform Electronic Transactions Act (the “Act”), the Parties authorize Escrow Holder to accept electronic and/or digital signatures and records, transmitted via facsimile or other electronic means (collectively “electronic signatures”) into this escrow as originals. The Parties agree that this escrow transaction may be conducted electronically to the fullest extent possible under the Act and recording laws. The Parties shall transmit original, wet signatures on (1) all documents to be recorded, (2) all documents excluded from being enforceable under the Act, and (3) all documents required to be in original form by any regulatory agency. The Parties shall verify any electronic signatures upon request of Escrow Holder.
- ACTS OUTSIDE OF ESCROW AND MEMORANDA ITEMS: Where provision is made to perform an act “outside of escrow,” Escrow Holder shall have no responsibility for, shall not be concerned with, and is specifically relieved from any obligation to pay, deliver any documents, or perform any act “outside of escrow.” Escrow Holder shall not to act upon or be concerned with or be liable for those items designated in the purchase agreement, escrow instructions, or supplemental instructions, as memoranda items between the Parties, nor any other agreement between the Parties not addressed to Escrow Holder in the form of a supplemental instruction.
- NO DUTY TO DISCLOSE OR INSPECT: Escrow Holder’s sole duty to disclose shall be the duty to disclose payment of invoices presented to Escrow Holder. Escrow Holder shall not be concerned with any disclosures, including disclosures related to lending, zoning, land division, property condition, or usury, except as expressly required to be given by an escrow service provider pursuant to Federal or State law. Escrow Holder shall not conduct any lien or title searches regarding any personal property sold or transferred through this escrow transaction. Escrow Holder urges the Parties to seek counsel from an attorney or licensed broker to ascertain what disclosures and/or laws, if any, need to be complied with prior to close of escrow. The Parties shall jointly and severally indemnify and hold harmless Escrow Holder’s conduct or omission resulting from a Party’s or agent’s misrepresentation or omission, or failure to comply with the rules and regulations of any governmental agency, whether state, federal, county, municipal, or otherwise. Escrow Holder shall not be concerned with enforcement of any rules or regulations. Escrow Holder may pay any presented invoice related to disclosures, without further instructions. Escrow Holder will make no physical inspection of the real property or personal property that is the subject of this escrow transaction. Escrow Holder shall not be concerned with or liable for the condition of such real property or personal property.
- FEDERAL TAX REPORTING (1099 FORMS): The Parties acknowledge their awareness that upon transfer of property, Escrow Holder must provide information pertaining to the escrow transaction to the Internal Revenue Service as required by Internal Revenue Code Section 6045(e) concerning production of 1099 forms. The Parties shall provide Escrow Holder all information necessary to produce the tax reporting documentation in compliance with Federal Law.
- FEDERAL TAX WITHHOLDING (FIRPTA): The sale of a U.S. real property interest by a foreign person is subject to the Foreign Investment in Real Property Tax Act of 1980 (“FIRPTA”) income tax withholding. This law authorizes the United States to tax foreign persons on the sale of U.S. real property interests. Persons purchasing U.S. real property interests from foreign persons, certain purchasers’ agents, and settlement officers may be required to withhold a portion of the amount realized. Withholding is intended to ensure U.S. taxation of gains realized on disposition of such interests. The purchaser is liable if the withholding is not made when required. The Parties shall execute and deliver to Escrow Holder any instrument, affidavit and statement or to perform any act reasonably necessary to carry out the provisions of FIRPTA and regulations promulgated thereunder. Buyer agrees to hold Escrow Holder harmless from any loss or damage that may be suffered by Buyer by reason of Buyer’s failure of either Party to comply with FIRPTA.
- STATE TAX WITHHOLDING: The following disclosure is being provided pursuant to California law for all escrow transactions wherein a transfer of title is being completed as part of the escrow transaction. In accordance with Section 18662 of the Revenue and Taxation Code, a buyer may be required to withhold an amount equal to 3⅓ percent of the sales price, or an optional gain on sale withholding amount certified by the seller in the case of a disposition of California real property interest by either: (a) A seller who is an individual, trust, estate, or when the disbursement instructions authorize the proceeds to be sent to a financial intermediary of the sellers; or (b) A corporate seller that has no permanent place of business in California immediately after the transfer of title to the California property. The buyer may become subject to penalty for failure to withhold an amount equal to the greater of 10 percent of the amount required to be withheld or five hundred dollars ($500). However, notwithstanding any other provision included in the California statutes referenced above, no buyer will be required to withhold any amount or be subject to penalty for failure to withhold if any of the following apply: (a) The sale price of the California real property conveyed does not exceed one hundred thousand dollars ($100,000); (b) The seller executes a written certificate, under the penalty of perjury, certifying that the seller is a corporation with a permanent place of business in California; (c) The seller, who is an individual, trust, estate, or a corporation without a permanent place of business in California, executes a written certificate, under the penalty of perjury, of any of the following: (i) The California real property being conveyed is the seller’s or decedent’s principal residence (within the meaning of Section 121 of the Internal Revenue Code (IRC)); (ii) The last use of the property being conveyed was use by the transferor as the transferor’s principal residence (within the meaning of IRC Section 121); (iii) The California real property being conveyed is, or will be, exchanged for property of like kind (within the meaning of IRC Section 1031), but only to the extent of the amount of gain not required to be recognized for California income tax purposes under IRC Section 1031; (iv) The California real property has been compulsorily or involuntarily converted (within the meaning of IRC Section 1033) and the seller intends to acquire property similar or related in service or use so as to be eligible for nonrecognition of gain for California income tax purposes under IRC Section 1033; or (v) The California real property transaction will result in a loss or net gain not required to be recognized for California income tax purposes. The seller is subject to penalty for knowingly filing a fraudulent certificate for the purpose of avoiding the withholding requirement.
- SUPPLEMENTAL PROPERTY TAXES: THE FOLLOWING DISCLOSURE IS MADE, PURSUANT TO CALIFORNIA CIVIL CODE § 1102.6C: “CALIFORNIA PROPERTY TAX LAW REQUIRES THE ASSESSOR TO REVALUE REAL PROPERTY AT THE TIME THE OWNERSHIP OF THE PROPERTY CHANGES. BECAUSE OF THIS LAW, YOU MAY RECEIVE ONE OR TWO SUPPLEMENTAL TAX BILLS, DEPENDING ON WHEN YOUR LOAN CLOSES. THE SUPPLEMENTAL TAX BILLS ARE NOT MAILED TO YOUR LENDER. IF YOU HAVE ARRANGED FOR YOUR PROPERTY TAX PAYMENTS TO BE PAID THROUGH AN IMPOUND ACCOUNT, THE SUPPLEMENTAL TAX BILLS WILL NOT BE PAID BY YOUR LENDER. IT IS YOUR RESPONSIBILITY TO PAY THESE SUPPLEMENTAL BILLS DIRECTLY TO THE TAX COLLECTOR. IF YOU HAVE ANY QUESTIONS CONCERNING THIS MATTER, PLEASE CALL YOUR LOCAL TAX COLLECTOR’S OFFICE.”
If there is an impound account for taxes, the borrower is advised to inquire with the lender to determine if the supplemental tax bill will be paid by the lender from the impound account. Tax bills issued AFTER the close of escrow shall be handled or prorated directly between the Parties outside of escrow. Escrow Holder shall prorate taxes at the close of escrow based on the latest available tax statement and is relieved of any liability for taxes and/or prorations necessary after close of escrow as a result of supplemental tax bills issued by the tax assessor.
- PERSONAL PROPERTY TAXES: Escrow Holder shall not be responsible for any personal property taxes which may be assessed against any former or present owner of the property that is the subject of this escrow transaction, nor for the corporation or license tax of any corporation as a former or present owner.
- PRELIMINARY CHANGE OF OWNERSHIP REPORT: California Revenue and Taxation Code § 480.3 requires that a Preliminary Change of Ownership Report be completed and certified by the transferee and filed concurrently with the recording of any document that reflects a change of ownership in real property. The Parties shall complete and sign said report and deliver it to Escrow Holder for filing, as necessary. The recorder’s office may charge a non-refundable fee of twenty dollars ($20.00) should the fully completed/certified report not accompany the conveyance document. If the recorder’s office charges such a fee, the Party benefitted by the recording of the transfer document shall be charged the fee at close of escrow. In such event, a Standard Change of Ownership Statement form will be mailed to the transferee by the office of the county assessor. If Buyer fails to file this form upon the request of the county assessor after the close of escrow, severe penalties may be assessed against the Buyer.
- PROPRIETARY INFORMATION: Escrow Holder is relieved of any duty, responsibility, and/or liability relative to disclosure of a Party’s or agent’s proprietary information. Propriety information may include any (A) sale, resale, loan, exchange, or other transaction involving the real property or personal property that is the subject of this escrow transaction, and (B) benefit, which may include financial gain or profit, involving the real property or personal property that is the subject of this escrow transaction. Escrow Holder shall be relived of any liability if proprietary information is disclosed as necessary for Escrow Holder to comply with the Parties’ instructions or if requested by a lender, agent, governmental agency, or any other entity entitled to the propriety information. Escrow Holder may furnish copies of all escrow instructions, amendments, preliminary title reports, closing statements, and related documentation to agents and attorneys representing any Party, as may be requested, without obtaining any further authorization from Buyer or Seller.
- NOTIFICATION OF DISHONORED CHECKS: If any check submitted to Escrow Holder is dishonored upon presentment for payment, Escrow Holder may notify all Parties and/or their respective agents of such nonpayment. The Party receiving credit for the deposit shall pay a reasonable fee to Escrow Holder for the returned check.
- DOCUMENT SUFFICIENCY AND VALIDITY: Escrow Holder shall not be responsible or liable for the sufficiency or validity of any document deposited with Escrow Holder, including the form, content, and manner of execution. All signatures submitted into this escrow transaction shall be construed as unconditional approval of the within document as to form, content, terms, and conditions. Escrow Holder shall have no obligation to verify, and will not verify, the authenticity of any signature on any document, nor the validity of such document. Escrow Holder shall not be liable or responsible for any loss that might occur due to forgeries, fraud, or false representations made by or involving the Parties, third parties, agents or any other person or entity.
- ACCEPTABILITY OF COUNTERPARTS: These instructions may be executed in counterparts, each of which shall be deemed an original regardless of the date of its execution and delivery. All such counterparts together shall constitute one and same document.
- STANDARDIZED FORMS: Escrow Holder shall use Escrow Holder’s usual document forms or the usual forms of any reliable forms company or any title company and, in the instructions, insert dates and terms on the instruments if incomplete when executed. Excepting Escrow Holder’s own form, Escrow Holder shall not be liable for the correctness or sufficiency of such standardized preprinted forms.
- NEW FINANCING: Escrow Holder shall have no liability or responsibility and shall not be concerned with the terms of any new financing obtained by Buyer or the contents of any loan documents, except to order transmission of loan documents to Escrow Holder, transmit the loan documents to the appropriate Parties for execution, and transmit the executed loan documents to the lender. Escrow Holder is not involved or concerned with the approval or processing of any loan or the contents and effect of any loan documents prepared by a lender. Escrow Holder is not responsible for any lender’s instructions which require Escrow Holder to perform obligations or duties beyond those required by law or which require Escrow Holder to assume liability for the lender’s regulatory duties and responsibilities. Escrow Holder shall have no obligation to agree to instructions from a lender which threaten to transfer liability or penalize Escrow Holder.
- MASTER/DUAL CLOSING STATEMENT: Certain lenders may require a copy of the Master/Dual Closing Statement, Seller Closing Disclosure and/or records showing all deposits and disbursements occurring as part of this escrow transaction. Escrow Holder is instructed to release the Master/Dual Closing Statement and other lender requested documents as required. This information may be disclosed to the Buyer as part of the Buyer’s Closing Disclosure by the lender.
- RESPA GUIDELINES: For Escrow Holder to comply with the Real Estate Settlement Procedures Act (“RESPA”), some of the costs and charges may need to be itemized on the lending disclosures in a manner different from the terms agreed to by the Parties. The costs and charges may include the title policy fees and documentary transfer taxes. Escrow Holder is instructed to comply with these RESPA guidelines as necessary. These charges and credits shall not change the amount of any other charges and credits between the Parties.
- TITLE INSURANCE: Escrow Holder shall order title insurance from the title company designated by the Parties. If requested in writing by the mutual instructions of the Parties or upon the request of any lender, Escrow Holder shall provide copies of the preliminary report of title to them without liability as to its contents. The Parties acknowledge that the title insurance policies to be issued by the title company shall be delivered directly from the designated title company to the appropriate Parties after the close of escrow. The Parties agree that matters regarding that title insurance are between the title company and the insured Party and not Escrow Holder.
- PROPERTY INSURANCE: Excluding transactions where the subject property is a parcel of vacant land, Buyer is made aware that, prior to close of escrow, property insurance coverage should be obtained with sufficient liability and replacement cost. If Buyer is obtaining new financing, insurance coverage will be a condition of the loan prior to funding. Buyer shall deposit sufficient funds to pay for the first year’s premium per invoice submitted by insurance agent. If the subject property is covered by a blanket master policy of insurance, Escrow Holder shall order a certificate thereof for the Buyer and order loss payable endorsements for beneficiaries of trust deeds being recorded herein. Should Buyer desire fire insurance on personal property, Buyer shall obtain it outside of escrow. If Buyer is purchasing the subject property in an all cash transaction, without financing, Escrow Holder is not responsible for ordering a certificate of insurance.
- AUTHORIZATION TO USE SUB-ESCROW AGENT: Escrow Holder may use the title company as a sub-escrow agent for the handling of funds and documents in this escrow transaction. Escrow Holder shall comply with all sub-escrow agent’s instructions and requirements, and Escrow Holder may deliver funds or documents to the sub-escrow agent at any time during the course of this escrow transaction as Escrow Holder deems appropriate. The Parties shall pay the fee for the sub-escrow service as charged by the title company.
- BENEFICIARY DEMANDS AND STATEMENTS: From funds due, Escrow Holder is authorized to pay at the close of escrow, any encumbrances of record, plus accrued interest, charges and bonus if any, and/or pay any delinquent monthly installments(s) on existing encumbrance(s) as disclosed by a beneficiary demand or statement without additional approval. Should a Party wish to pre-approve any beneficiary demand or statement, that Party shall deliver separate and specific written instruction to Escrow Holder prior to the close of escrow. Escrow Holder is not responsible for the contents or accuracy of any beneficiary demand or statement delivered to Escrow Holder by the beneficiary. Payoffs of encumbrances are done by the insuring title company, not Escrow Holder, and the Parties shall seek any redress directly from the beneficiary and/or title company should a dispute arise regarding said payoff. Some lenders require payment of loans to offices outside of the area or outside of the state. Interest will continue to accrue on any outstanding loans until the loan is paid in full, regardless of the date of close of escrow. The title company may charge messenger fees, wire fees, and/or overnight fees, which the benefitted Party shall pay at close of escrow.
- LINE OF CREDIT PAYOFF INDEMNIFICATION AND CANCELLATION: The Parties indemnify and hold the title company and Escrow Holder harmless from incurring any costs or additional charges, interest, and advances made but not disclosed on a beneficiary demand or statement provided for the payoff of that certain equity line of credit deed of trust (“line of credit”) shown on a preliminary title report. The Parties warrant and represent that instructions to the beneficiary have been made to freeze the line of credit, that no advance on the line of credit has been made since the opening of this escrow transaction, and that no advance will be made on the line of credit prior to close of escrow. If, after receipt of payoff, the beneficiary makes demand for additional funds, the Parties shall deposit those funds immediately with the title company or Escrow Company and authorize the title company to utilize those funds to effectuate the close of the line of credit. Upon payoff of the line of credit, Escrow Holder is instructed to request that the beneficiary cancel the line of credit.
- PRORATIONS AND ADJUSTMENTS: Escrow Holder is instructed to make all prorations and adjustments based on a thirty (30) day month. Escrow Holder is to use information contained on latest available tax statement, rental statement, beneficiary’s statement, insurance statement, or other statement as delivered to Escrow Holder for the prorations provided for herein.
- RECORDING OF DOCUMENTS: The Parties authorize the recordation of any instrument delivered through this escrow transaction if necessary or proper for the issuance of the required policies of new loan or as necessary for close of escrow. Recording fees shall be charged to the account of the benefited Party unless instructed otherwise by the Parties in writing.
- ESCROW AMENDMENT RE SENATE BILL (SB) 2 – BUILDING HOMES AND JOBS ACT FEE: Pursuant to California Government Code Section 27388.1, all California County Recorders are now required to collect a fee of seventy-five dollars ($75.00), in addition to the recording fees, upon presentment of certain real estate documents for recording. The fee is charged at the time of recording on “every real estate instrument, paper, or notice required or permitted by law to be recorded per each single transaction per parcel of real estate.” Section 27388.1 does not define any of the terms contained within its language, so at the present time the County Recorders are individually making interpretations regarding which documents the fee is being collected on and how much is being collected. Escrow holder is authorized and instructed to estimate the fee that will be charged on any particular document to be recorded as part of this escrow transaction. The parties agree to hold escrow harmless in the event the amount estimated is different from the amount actually charged by the County Recorder relative to any particular document. The parties further agree and authorize Escrow Holder to charge any additional fee to them, as appropriate, and deduct said amount from any funds due said party at close of escrow.
- DELIVERY OF DEED: Regardless of the date of execution or transmission to Escrow Holder, the deed shall be deemed delivered ONLY upon recordation through this escrow transaction. “Close of escrow” as used in this escrow transaction shall mean the date on which documents are recorded, unless otherwise specified.
- ASSIGNMENT OF FUNDS: If a Party unilaterally assigns or orders the proceeds of this escrow transaction to be paid to other than the original Parties, the assignment or order shall be subordinate to the expenses of this escrow transaction, liens of record on the subject property, and payments directed to be made by Parties to this escrow transaction. If the result of the assignment or order would leave the escrow without sufficient funds to close, then Escrow Holder is directed to close nevertheless and pay the assignment or order only out of the net proceeds due the Party assigning their funds except for the assignment or order, and to pay them in the order in which the assignment or order is received by Escrow Holder. Escrow Holder shall not be concerned with any balance remaining unpaid.
- DISBURSEMENT OF FUNDS AND DELIVERY OF DOCUMENTS: All disbursements shall be made by the Escrow Holder’s trust account check unless instructed otherwise in writing. Escrow Holder will not indemnify any payee or guarantee signatures of any person or entity at any financial institution. Generally, Escrow Holder or its sub-escrow agent will disburse funds, including net proceeds and payment for encumbrances of record, on the date the escrow closes; however, there are circumstances which may arise wherein the disbursements could be delayed by one or two business days. Any funds disbursed at the close of escrow will be issued jointly to the Parties designated as payee unless Escrow Holder is instructed otherwise in writing by all designated payees. The funds representing loan and/or sale proceeds will be disbursed jointly to all persons who were the record owners of the subject property. All disbursements of funds and/or delivery of other documents or instruments concerning this escrow transaction will be mailed to the entitled Party by regular first-class mail, postage prepaid, at the last address received by Escrow Holder. However, at Escrow Holder’s discretion, Escrow Holder may send funds and/or other documents by certified or registered mail, overnight delivery, or messenger, in which case the Party for whom the delivery was made shall pay the costs.
- REPEAT CUSTOMERS: Escrow Holder may provide a fee discount to customers who completed one or more escrows with Escrow Holder within the last two (2) years, upon request. Escrow Holder will provide the discount solely to the repeat customer irrespective of the Parties’ agreement concerning the division of escrow fees.
- SEVERABILITY: Invalidity or unenforceability of any provision in these General Provisions, the escrow instructions or any supplemental instructions, (collectively, “Agreement”) shall not affect any other provision of this Agreement. If possible, any unenforceable provision within this Agreement will be modified to reflect the parties’ original intention.
- CONFLICTING INSTRUCTIONS: If conflicting demands or notices are made or served upon Escrow Holder or any controversy arises between the Parties or with third persons arising out of or relating to this escrow transaction, Escrow Holder shall have the absolute right to withhold and stop all further proceedings in, and in performance of, this escrow transaction until Escrow Holder receives written notification satisfactory to Escrow Holder of the settlement of the controversy by the Parties’ written agreement, or by a final order or judgment of a court of competent jurisdiction.
- MUTUAL CANCELLATION INSTRUCTION REQUIREMENTS: The Parties acknowledge that they are on notice that Escrow Holder shall exercise its discretion to require mutual or matching cancellation instructions instructing Escrow Holder on how the deposit is to be released, signed by all Parties and deposited with Escrow Holder prior to releasing any deposit held by Escrow Holder relative to this escrow transaction.
- CANCELLATION FEES: If this escrow transaction is cancelled or otherwise terminated, the Parties shall pay Escrow Holder for any costs or expenses which Escrow Holder may have incurred or become obligated for pursuant to this escrow transaction and a reasonable escrow fee for the services performed to date. These costs and expenses and Escrow Holder’s fee shall be deposited with Escrow Holder before any cancellation or other termination is effective. Charges for these costs, expenses and fees may be apportioned between the Parties in a manner which Escrow Holder, in its sole discretion, considers equitable. Escrow Holder’s decision in that regard will be binding and conclusive upon the Parties unless otherwise agreed to in writing or determined by a court of competent jurisdiction. The Parties shall additionally pay reasonable fees for any attorney services, which may be required to collect outstanding costs, expenses, and fees. Upon payment of cancellation fees, Escrow Holder may return documents and funds to the respective Parties and void executed instruments as appropriate.
- TIME IS OF THE ESSENCE: Time is of the essence in these instructions. If the conditions of this escrow transaction have not been complied with at the expiration of the provided time, including any extension, Escrow Holder is instructed to complete this escrow transaction as soon as possible, unless written demand upon Escrow Holder to cancel this Escrow or for the return of the money and/or instruments is deposited by one or more Parties. If the date by which the Parties’ performances are due shall be other than Escrow Holder’s regular business day, such performances shall be due on Escrow Holder’s next business day.
- ABANDONMENT OF ESCROW TRANSACTION: Escrow Holder duties and functions related to this escrow transaction shall terminate six (6) months following the date last set for close of escrow unless the escrow transaction has closed or cancelled. At such time, Escrow Holder shall have no obligations as Escrow Holder except to disburse funds and documents pursuant to written instructions and to interplead or otherwise dispose of funds and documents in accordance with a validly issued and validly served order from a court of competent jurisdiction.
- UNCASHED CHECKS: If any check(s) issued through this escrow transaction or sub-escrow related hereto are uncashed or unnegotiated (“uncashed”) Escrow Holder will effort to contact the payee and coordinate negotiation of the check(s). Escrow Holder incurs significant expense in tracking uncashed checks, canceling and reissuing checks, and maintaining bank and accounting records of such checks. Therefore, if re-issuance of the check is necessitated, Escrow Holder will require an instruction authorizing such re-issuance and may charge an additional services fee of twenty-five dollars ($25.00) which will be deducted from the payee’s reissued check(s).
- ESCHEATMENT: Any funds remaining in escrow three (3) years after the close of escrow or cancellation of this escrow transaction will be escheated to the State of California pursuant to the Unclaimed Property Law codified in California Code of Civil Procedure § 1518.
- AUTHORIZATION TO INTERPLEAD FUNDS: The Parties acknowledge that Escrow Holder has an absolute right to file a court action in interpleader. If such an action is filed, the Parties jointly and severally shall pay all resulting escrow fees, title fees, court costs, and litigation expenses, including attorney’s fees. The amount shall be fixed by judgment to be reached by the court. Upon filing of such action, Escrow Holder is fully released and discharged from any further performance of duties under the terms of this Escrow.
- RIGHT TO RESIGN: At any time prior to the close of escrow, Escrow Holder, at its sole and absolute discretion and without liability to the Parties, may withdraw and resign from acting as Escrow Holder by providing ten (10) days prior written notice to the Parties at their last known addresses. Escrow Holder shall be entitled to reasonable compensation for its escrow services performed and for all costs and expenses incurred in the resignation, including, but not limited to, attorney’s fees. Upon resignation, Escrow Holder shall return to the Parties who deposited the same, the balance of any funds, along with any property or documents, in its possession. Alternatively, at the mutual instruction of the Parties, Escrow Holder shall deliver the funds, property, and documents to a new Escrow Holder.
- DESTRUCTION OF DOCUMENTS: Escrow Holder is authorized to destroy or otherwise dispose of any and all documents, papers, escrow instructions, correspondence, records or other material pertaining to this escrow, at any time after five (5) years from the date of close of escrow, cancellation of this transaction, or the date of the last activity (whichever comes first), without liability and without further notice to the Parties.
- PRIVACY NOTICE: This notification complies with our obligation to comply with federal and state law to safeguard the Parties’ non-public personal information. Escrow Holder collects non-public personal information about the Parties from the following; a) Information Escrow Holder receives from the Parties on applications or other forms; b) Information about the Parties’ transactions with Escrow Holder, Escrow Holder’s affiliates, or others involved in the processing of the transaction; and c) Information Escrow Holder receives from a consumer reporting agency. Escrow Holder does not disclose any non-public personal information about customers or former customers to anyone, except as permitted by law. Escrow Holder restricts access to non-public information about the Parties to those employees who need to know that information to provide products or services to the Parties. Escrow Holder maintains physical, and procedural safeguards that comply with federal and state regulations to guard the Parties’ non-public personal information. By signing below, the Parties acknowledge that they have read and received a copy of this notification.
- PROHIBITION UPON GIVING LEGAL OR FINANCIAL ADVICE: The Parties acknowledge and understand that Escrow Holder is not authorized to practice law, nor does Escrow Holder give financial advice. The Parties are advised to seek legal and financial counsel and advice concerning the effect of this escrow transaction. The Parties acknowledge that no representations have been made by Escrow Holder about the legal sufficiency, legal consequences, financial effects, or tax consequences of the within escrow transaction.
EACH PARTY HAS RECEIVED AND HAS READ THESE INSTRUCTIONS AND GENERAL PROVISIONS ATTACHED HERETO AND AGREES TO BE BOUND THEREBY.
[Seller 1 Name] [Buyer 1 Name]
[Seller 2 Name] [Buyer 2 Name]