Escrow services rendered

An individual engaged in the business of acting as an escrow agent is called an escrow officer. The officer is employed by an escrow company and needs to be licensed.

The services rendered by the escrow officer typically include:

  • receiving funds and collecting necessary documents, such as property reports, disclosure statements and title reports called for in the escrow instructions [See RPI Form 401];
  • preparing documents necessary for conveying and mortgaging a property required for escrow to close;
  • calculating prorations and adjustments; and
  • disbursing funds and transferring documents when all conditions for their release have been met. [Calif. Financial Code§17003(a)]

The specific duties of the escrow officer vary according to local real estate custom. The duties of an escrow officer in a given transaction are outlined in the escrow instructions.

The escrow company is licensed by the Department of Business Oversight (DBO) unless exempt.

Companies exempt from the escrow licensing requirements are called controlled escrows.

Controlled escrows include:

  • a licensed real estate broker, either individual or corporate, who represents a person in the real estate transaction in which the broker will be performing escrow services;
  • a licensed attorney who does not hold themselves out as an escrow agent;
  • a bank, trust company, or insurance company; and
  • a title insurance company whose principal business is preparing abstracts or making searches of title used for issuing title insurance policies. [Fin C §17006]