Assignment of Escrow Funds and Insurance

What is the assignment of escrow funds and insurance

The assignment of escrow funds and insurance form follow the advises, the holder of the mortgage , the property has been transferred from a seller to a purchaser and assigns the money present in escrow deposits for the payment of insurance and tax. The agreement is usually used to transfer escrow from the seller’s name to the buyer’s name. The document authorizes the transfer of insurance policies which was held under the seller’s name to the buyer.

Escrow funds and insurance

During the home buying process, you may hear the word escrow and initially, you may feel confused. Escrow is an arrangement made between two parties, between a buyer and seller and a neutral third party will receive and disburse the money , document and instruction for the buyer and seller needs to complete the transaction. The agreement assures that the mortgage lender could be able to release fund for the purchase during the time when the deed gets changed reflecting new ownership.

When escrow begins

The escrow agreement is made when the buyer and seller signs a contract regarding real estate. The contract, along with additional instruction will need to be act as a neutral third party which is known as an escrow officer. The agent has been selected just like any other professional and you can get referrals from trusted sources to understand the service they provide and the cost. The escrow process gets started by assigning an escrow number to your escrow. The fund will be transferred to your escrow account and the fund can be used to complete the home purchase.

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ASSIGNMENT OF ESCROW FUNDS AND
INTEREST IN EXISTING HAZARD INSURANCE

Mortgage Company
Address
City, State, Zip
Phone #

Re:    Loan No. *********
Mortgagor’s Name
Address
City, State, Zip

Gentlemen:

The property securing the payment of the captioned loan has been sold to  ________________________TRUSTEE.

As part of the consideration for the sale of the security, we have agreed and do hereby agree that all funds held by you for the account of the Seller in connection with said loan or in escrow to pay taxes, maintenance fees, private mortgage insurance or insurance on the security shall hereafter belong to said undersigned purchasers; and the said undersigned purchasers shall have all rights in regard to any escrow overages or excess funds held by you and do also assume full responsibility for any escrow shortages and the sufficiency of funds on deposit in the escrow account for the payment of all such items after this date.

It is further understood and agreed that the present hazard insurance contract and premium are transferred and assigned to purchaser (including unearned premium and claims for losses thereunder) and are to remain in full force and effect on said property.  Should purchaser decide to replace the existing insurance coverage, any refund of premium shall be payable to PURCHASER.

Acknowledged and sign by the                     Acknowledged and signed by the
Seller this the _____ day of                               Purchaser this the _____ day of
____________, 20___.                                              ____________, 20___.

SELLER:                                                          PURCHASER:

_____________________________           _____________________________                                                                Name of Trustee, Trustee)                                                                                                                                Address
Phone: