You got an accepted offer. Now what happens between signing and getting the keys in Santa Monica? Escrow is where the details come together, and it can feel fast, technical, and high‑stakes. You want a smooth close, clear steps, and no surprises. This guide walks you through what escrow is, how the Santa Monica timeline usually works, the contingencies you will manage, what costs to expect, and how to avoid common pitfalls. Let’s dive in.
What escrow is and how it protects you
Escrow is a neutral third party that holds funds and documents, follows the contract, and releases money only when agreed conditions are met. It coordinates title work, lender requirements, HOA documents for condos, and recording with Los Angeles County. Escrow does not give legal or lending advice, so you rely on your agent, lender, and any attorney for those issues.
In a typical Santa Monica purchase, your team includes you, the seller, both agents, the escrow officer, a title company, your lender if you are financing, and the county recorder. California law also requires specific seller disclosures, including a Transfer Disclosure Statement and a Natural Hazard Disclosure.
Typical Santa Monica escrow timeline
Most financed purchases close in 30 to 45 days. All‑cash deals can close faster, often in 7 to 21 days. Condo escrows may need extra time for HOA documents and review.
Day 0: Open escrow
You and the seller sign the purchase agreement, and the escrow company named in the contract opens the file. The escrow officer issues instructions and an initial document list to both parties.
Day 0–3: Deposit earnest money
You wire your earnest money, sometimes called the good‑faith deposit, per the contract. The amount is negotiated, often about 1 to 3 percent of the price, and escrow issues a receipt.
Day 1–7: Orderings and scheduling
You schedule inspections, including a general home inspection and any specialty inspections you need. If you are financing, you submit your loan application and the lender orders the appraisal. Title opens a search and prepares a preliminary report. For condos, the HOA document request begins.
Day 7–14: Inspections and reports
You complete physical inspections within your inspection contingency. You may request repairs or credits, and the seller can respond or negotiate. A pest or termite inspection is common in older California properties.
Day 10–21: Contingency removals
You remove or waive contingencies by your contract deadlines. Typical ranges include 7 to 17 days for inspections and 17 to 21 days for loan approval. The appraisal contingency is tied to your lender timeline. Condo buyers receive HOA documents and have a short statutory review period once delivered.
Day 7–30: Appraisal and underwriting
Your appraisal is scheduled, usually within one to two weeks after loan application. Underwriting reviews your file and conditions. You receive a clear‑to‑close when the lender is satisfied.
Day 25–30: Closing logistics
Escrow prepares your closing statement and coordinates with the lender on the Closing Disclosure. You finalize homeowners insurance and provide proof. You do a final walkthrough about 24 to 48 hours before closing to confirm condition and agreed repairs.
Day 30: Funding and recording
You wire the balance of your down payment and closing costs to escrow following verified instructions. The lender funds the loan to escrow. Escrow records the deed with Los Angeles County, the title company issues title insurance, and funds are disbursed. You receive keys per the contract.
Key contingencies you will manage
- Inspection contingency. Lets you investigate condition and request repairs or credits.
- Pest or wood‑destroying organism inspection. Common for older homes and can lead to treatment or repair plans.
- Loan contingency. Protects you if your mortgage is not approved by the deadline.
- Appraisal contingency. Helps if the appraised value is below the contract price, subject to the exact contract language.
- HOA document review for condos. You receive governing documents, budgets, reserves, meeting minutes, insurance, and any assessment details. You have a short statutory window to review after delivery.
Condo escrow considerations in Santa Monica
Condo purchases include an HOA package with CC&Rs, bylaws, budgets, reserve studies, insurance certificates, recent meeting minutes, and rules about rentals and pets. Review monthly dues, reserve levels, any special assessments, litigation history, and rental caps. Confirm what the HOA master insurance policy covers and what your HO‑6 policy must cover. Some buildings may be in retrofit programs or have structural items to review.
If you are buying a short sale or REO, expect longer timelines and different approval steps. Build extra time into your escrow plan.
Who pays what and common closing costs
Custom varies by neighborhood and negotiation, so confirm with your agent and escrow officer early. Title premiums in California are regulated and based on price.
- Earnest money deposit. Paid by the buyer and credited at closing.
- Escrow fees. Often split between buyer and seller in Southern California, but terms are negotiable.
- Title insurance. Sellers often pay the owner’s policy and buyers pay the lender’s policy if financed, though this is negotiable and varies.
- Recording fees and transfer taxes. County recording fees apply. Los Angeles County and some cities impose documentary transfer taxes. Who pays is negotiable and often shared or paid by the seller in part.
- Property tax proration. Taxes are prorated based on the closing date. California counties bill in two installments, commonly due November 1 and April 1.
- HOA transfer and move fees. Often paid by the buyer or negotiated. Confirm amounts with the HOA.
- Lender fees. Appraisal, origination, credit report, and related costs are usually buyer‑paid.
- Homeowners insurance. You typically pay the first year’s premium before or at closing.
- Repairs and credits. Negotiated after inspections and finalized before contingency removal.
Ask your escrow officer and lender for an itemized estimate early, and update it after appraisal and any repair credits.
Buyer checklist for Santa Monica escrows
Before opening escrow
- Get preapproval or provide proof of funds if all cash.
- Align on escrow length and contingency timelines that fit your lender and inspections.
Right after opening
- Wire your earnest money and keep the receipt.
- Schedule general, pest, and any specialty inspections.
- Submit your full loan package and track appraisal scheduling.
- For condos, request HOA documents and review rules, reserves, parking, and any assessments.
- Verify property tax status and any special assessments.
Mid‑escrow
- Negotiate inspection items and confirm any credits or seller work in writing.
- Remove contingencies on time. Calendar your deadlines.
- Bind homeowners insurance and send proof to lender and escrow.
Final steps
- Do the final walkthrough 24 to 48 hours before closing.
- Call your escrow officer to confirm wire instructions and protect against fraud.
- Send final funds per instructions. Avoid last‑minute account changes.
- Receive keys and possession per your contract after recording.
Common pitfalls and how to avoid them
- Wire fraud. Never rely on email alone. Call your escrow officer using a known phone number before sending any funds.
- Appraisal shortfalls. If the appraisal comes in low, consider renegotiation, bringing cash to cover a gap, or providing additional comparable sales to your lender.
- HOA surprises. Ask for current financials and any litigation disclosures. Consider legal advice if assessments or litigation are sizable.
- Missed deadlines. Track every contingency removal date. Late removal can waive rights.
- Unpermitted work. Older homes may have unpermitted additions. Verify city permits and ask for complete seller disclosures.
- Late lender conditions. Underwriters may ask for new documents near closing. Avoid major financial changes during escrow and respond quickly.
Local resources and who to consult
- Your agent. Guides local customs, negotiates timelines and who pays what, and keeps deadlines on track.
- Escrow and title. Provide estimated closing statements, escrow instructions, and exact county or city fee details.
- Lender. Sets loan and appraisal timelines and issues your Loan Estimate and Closing Disclosure.
- City and county offices. Confirm transfer taxes, recording procedures, and property tax proration norms.
- HOA management. Supplies the condo document package and clarifies rules and fees.
- Licensed inspectors. Deliver condition reports and repair recommendations.
- Real estate attorney. Useful for complex title, disclosure, or HOA issues.
A clear escrow plan helps you move from offer to ownership with confidence. If you want a streamlined process and careful oversight on milestones, documents, and costs, schedule a private consultation with Hannah Laird.
FAQs
What is escrow in California and why is it used?
- Escrow is a neutral service that holds funds and documents, confirms contract conditions are met, coordinates title and recording, and releases money only at closing.
How long does escrow take in Santa Monica for buyers?
- Financed escrows typically run 30 to 45 days, while all‑cash purchases can close in 7 to 21 days if documents and title are ready.
How much earnest money do buyers usually deposit?
- The amount is negotiated and commonly ranges from about 1 to 3 percent of the purchase price, credited to you at closing.
Which buyer contingencies are most common in Santa Monica?
- Inspection, pest, loan, appraisal, and HOA review for condos are common, each with specific removal deadlines set in your contract.
What should condo buyers review in the HOA documents?
- Review CC&Rs, bylaws, budgets, reserves, meeting minutes, insurance, rental rules, and any special assessments or litigation disclosures.
Who pays for title insurance and transfer taxes in Los Angeles County?
- Custom varies and is negotiable; sellers often pay the owner’s policy, buyers often pay the lender’s policy, and transfer tax splits depend on the agreement.
How do I avoid wire fraud during escrow?
- Always call your escrow officer at a verified number to confirm wiring instructions and never act on unexpected email changes without voice confirmation.
