Buying a home in Sacramento is exciting, but the escrow process can feel like a black box. You send money, sign stacks of papers, and wait for a call that says it recorded. If you want more control and fewer surprises, understanding how escrow really works is your best tool. In this guide, you’ll learn the Sacramento timeline, who does what, what it costs, and how to protect your funds. Let’s dive in.
Escrow in California, simply explained
Escrow is a neutral process that holds your funds and documents until every agreement in the contract is satisfied. The escrow officer follows written instructions from you and the seller and only releases money or title when conditions are met. This protects both sides and keeps the transaction on track.
Escrow is not title insurance. Escrow coordinates the flow of money and paperwork. Title insurance protects you and your lender from past title issues like undisclosed liens or claims that might affect your ownership after closing.
In California, escrow and title practices are regulated. You should expect to work with a licensed escrow officer and an established title company. Common documents you will see include your Purchase Agreement, escrow instructions, the preliminary title report, your lender’s loan package if you are financing, and required California disclosures.
The Sacramento escrow timeline
Every contract sets its own deadlines, but most financed purchases in Sacramento close in about 30 to 45 days. Cash purchases can move faster, sometimes in 7 to 14 days. The timeline below follows a typical local sequence.
1) Earnest money deposit
Once the seller accepts your offer, escrow opens and you send your earnest money by the deadline in your contract. Escrow deposits it into a secure trust account and orders the preliminary title report.
2) Disclosures and the preliminary title report
Early in escrow, the seller delivers required California disclosures. You will see the Transfer Disclosure Statement that covers known property conditions and a Natural Hazard Disclosure that identifies things like flood or fire hazard zones. At the same time, you receive the preliminary title report for Sacramento County. Review these carefully and ask questions about any items you do not recognize.
3) Inspections and due diligence
Most buyers order a general home inspection and may add pest, roof, sewer, or HVAC inspections. Your contract sets the inspection contingency period, so schedule these right away. Use the findings to request repairs, negotiate credits, or, if needed, cancel within the contingency window.
4) Financing and appraisal
If you are getting a loan, apply promptly. Your lender orders an appraisal and begins underwriting. You will be asked for documents like pay stubs, bank statements, IDs, and insurance details. Respond quickly to keep things moving.
5) Contingency removals
By each deadline, you will either remove contingencies in writing or negotiate an extension. Once you remove a contingency, your earnest money could be at risk if you later cancel without a contract-approved reason. Stay in close touch with your agent on timing.
6) Final walkthrough
Usually 24 to 72 hours before closing, you verify the property is in the expected condition and that agreed repairs are complete. This is not a re-inspection, but you can confirm that nothing changed since your offer.
7) Signing and funding
Escrow schedules your signing. You present government ID, sign escrow and loan documents, and arrange final funds by wire using verified instructions. Your lender reviews the signed package and wires loan funds to escrow when conditions are met.
8) Recording and keys
Escrow submits the deed to the Sacramento County Recorder. Once the deed records, title transfers to you. Escrow disburses funds per the instructions, and you receive keys and possession according to the contract.
Who does what in escrow
Buyer
You deposit earnest money, complete inspections, apply for your mortgage, and provide documents your lender needs. You review the preliminary title report and disclosures, select homeowner’s insurance, sign final documents, and send closing funds.
Seller
The seller provides disclosures and property information, clears title issues, completes agreed repairs or credits, signs the deed and escrow documents, and delivers possession per the contract.
Real estate agents
Your agent coordinates timelines, inspections, and paperwork. They keep you informed, help you interpret disclosures and title items, and work with escrow and the lender to keep everything aligned with the contract.
Escrow officer
Escrow opens the file, holds funds, orders the preliminary title report, coordinates signing and recording, tracks prorations for taxes and HOA dues, and issues the final settlement statement. Escrow is neutral and must follow written instructions.
Title company
Title reviews public records, issues the preliminary title report, resolves liens or judgments, and delivers title insurance policies at closing.
Lender
The lender orders the appraisal, underwrites the loan, confirms the title condition, and wires funds at closing. Most lenders require a lender’s title policy and proof of homeowner’s insurance.
Inspectors, HOAs, and utilities
Inspectors and pest companies complete reports. HOAs provide governing documents and financials when applicable. You will also coordinate utility transfers before closing.
Local costs and disclosures to expect
California requires several disclosures early in escrow. You will receive the Transfer Disclosure Statement and Natural Hazard Disclosure. If the home was built before 1978, you will receive lead-based paint disclosures. If there is an HOA, expect a package with budgets, CC&Rs, and rules.
Your preliminary title report lists recorded items that affect the property, such as easements and liens. Title issues must be resolved before closing. Ask your agent to walk through any exceptions you do not recognize.
Transfer taxes and recording fees apply at closing. Amounts and who pays can vary by city and by contract. Check current schedules with Sacramento County and, if the property is inside city limits, the City of Sacramento. Your purchase agreement will specify who pays which fees.
Who pays for owner’s and lender’s title insurance varies by local custom and negotiation. Title insurance premiums are based on the purchase price and are regulated. Ask your agent about common Sacramento practices so you know what to budget.
Here are typical buyer-side items you may see on your settlement statement:
- Lender fees, such as origination or underwriting
- Appraisal and credit report fees
- Lender’s title insurance policy and a share of escrow fees if split
- Recording fees and any transfer taxes if the contract assigns them to the buyer
- HOA document and transfer fees when applicable
- Prorated property taxes and HOA dues
- First year homeowner’s insurance premium or binder
- Optional home warranty
- Inspection and pest report fees
Two Sacramento practical notes:
- Property taxes are prorated at closing. California’s Proposition 13 sets your base tax from the new assessed value at purchase, which can differ from the seller’s bill.
- Some areas involve floodplain or levee considerations. If a home is in a Special Flood Hazard Area, your lender may require flood insurance. Your Natural Hazard Disclosure will flag these zones.
Local ordinances can require specific inspections or compliance items. Check city or county requirements for the property’s address early in escrow to avoid delays.
Keep your funds safe from wire fraud
Wire fraud targeting homebuyers is a real risk. Use these habits to protect yourself:
- Always call the escrow company using a phone number you know is correct to confirm wiring instructions. Do not rely on a phone number or link in an email.
- Ask whether your escrow company uses a secure portal. Avoid emailing sensitive information.
- Verify any change to wiring instructions in person or by a direct phone call to a verified number.
- Consider sending a small test wire and confirming receipt before sending the full amount.
Your step-by-step checklist after acceptance
- Deposit earnest money per your contract and confirm escrow account details.
- Confirm your escrow company’s name, licensed status, and key contacts.
- Deliver required documents to your lender quickly.
- Schedule inspections early: home, pest, roof, sewer, or HVAC as needed.
- Review the Transfer Disclosure Statement and Natural Hazard Disclosure in detail.
- Read the preliminary title report and ask about any exceptions or liens.
- Arrange homeowner’s insurance effective on closing day.
- Request your final cash-to-close figure and verify wire instructions by phone.
- Attend your final walkthrough and confirm agreed repairs are complete.
- Bring a valid government ID to signing and confirm notary details.
- After closing, confirm recording and coordinate keys and possession.
What happens on closing day
On signing day, you complete escrow and loan documents with a notary and wire your funds using verified instructions. Your lender reviews the package and, once satisfied, sends loan funds to escrow. Escrow then sends the deed for recording at the Sacramento County Recorder. When recording is confirmed, the home is officially yours and you receive keys and possession per your contract.
How we help you navigate escrow
You should feel calm, informed, and protected from offer to keys. With decades of Sacramento experience and a methodical approach, we help you track deadlines, interpret disclosures and title items, coordinate inspections, and keep your lender and escrow officer aligned. If you are supporting a parent or handling an estate, our certified Senior Move Management service can coordinate sorting, packing, contractor oversight, and a smooth handoff on closing day.
If you are ready for steady guidance through escrow, reach out today. Schedule a free consultation with Lee Mahla - Main Site.
FAQs
How does escrow protect Sacramento homebuyers?
- Escrow holds your funds and documents and releases them only when every contract condition is met, preventing either side from moving forward until all obligations are satisfied.
What is the typical escrow timeline in Sacramento?
- Most financed purchases close in about 30 to 45 days, while all-cash deals may close in 7 to 14 days, depending on contract deadlines and complexity.
When is my earnest money refundable in California escrow?
- Your deposit is typically refundable while contingencies are in place and timelines are met. Once you remove a contingency, canceling can put your deposit at risk unless allowed by the contract.
What do I do if inspections uncover problems?
- Within the inspection contingency period, you can request repairs, negotiate credits, or cancel per the contract. After removing the inspection contingency, options are more limited.
What happens if my loan is denied during escrow?
- If your loan contingency remains and you act within the deadline, you can usually cancel and recover your deposit. If you removed that contingency, your deposit may be at risk.
Who pays closing costs in Sacramento County?
- It depends on the purchase contract and local custom. Some fees are split and others are assigned to buyer or seller. Your contract should spell out who pays what.
When do I get keys to my Sacramento home?
- You receive keys when the deed records with the Sacramento County Recorder and the contract’s possession terms are met.
How can I avoid wire fraud during closing?
- Call your escrow officer at a known number to confirm wiring instructions, avoid email-only changes, use secure portals, and verify receipt of any test wire before sending full funds.
