Buying a home in California comes with a word you hear a lot: escrow. If this is your first time, the process can feel opaque and fast-moving. You want clarity on who does what, what to expect each week, and how to protect your deposit. In this guide, you will learn the California escrow steps from offer to keys, with San Gabriel Valley timelines, common documents, costs, and smart ways to avoid delays. Let’s dive in.
Escrow basics in California
Escrow is a neutral, third-party process that holds funds and documents while both sides meet the terms of the purchase agreement. The escrow company coordinates paperwork, tracks deadlines, disburses funds, and works with the title team to record your deed at closing. It is designed to protect both buyer and seller.
Who is involved
- You and the seller are the principals.
- The escrow officer administers the file and instructions.
- The title company prepares the preliminary title report and issues title insurance.
- Your lender, if you have a loan, handles underwriting, the appraisal, and closing funds.
- Your real estate agents coordinate inspections, disclosures, and negotiations.
- Inspectors, HOA managers if applicable, and the county recorder may also be involved.
Step-by-step timeline
Every contract sets its own deadlines, but the following reflects common San Gabriel Valley norms. Escrows on financed purchases often run 30 to 45 days. All-cash deals and competitive situations can be shorter.
Days 0 to 3: Open escrow and deposit
Your offer is accepted, and you wire or deliver your initial earnest money deposit to escrow within the contract window, often 1 to 3 business days. Escrow opens the file, issues escrow instructions, and requests seller disclosures and title work. This is when you calendar key contingency dates.
Days 0 to 10 or 17: Disclosures and inspections
Sellers deliver required disclosures such as the Transfer Disclosure Statement and Natural Hazard Disclosure, along with any local forms. You schedule inspections quickly. Common choices include a general home inspection, termite, roof, sewer scope for older properties, HVAC, and any needed specialists. You can request repairs or credits, or cancel within the inspection period if allowed by your contract.
Days 0 to 21 or 30: Loan, appraisal, and underwriting
You apply for your loan right away. The lender orders an appraisal and begins underwriting. Appraisals often take 7 to 14 days from order in a normal market. If the appraised value is lower than the purchase price, you may renegotiate, bring extra cash, challenge the appraisal with your lender, or cancel if your appraisal contingency allows it.
Throughout escrow: Title review and clearance
The title company issues a Preliminary Title Report. You and your agent review for issues such as liens, easements, or judgments. Any items that affect clear ownership must be addressed before closing or listed as exceptions on the title policy. If you are buying in an HOA, you also review HOA documents within the required timelines.
Mid-escrow: Contingency removals
You remove contingencies in writing by the deadlines set in your agreement. These commonly include inspection, loan, appraisal, title, and HOA document review. If you negotiate repairs or credits, both sides sign addenda and escrow updates the file.
Final 3 to 5 days: Signing, funding, and recording
Your lender issues the Clear to Close and coordinates final loan documents. For financed purchases, you must receive the Closing Disclosure at least three business days before consummation. You and the seller sign closing documents at escrow or through an approved signing process. The lender wires funds, escrow records your deed with the county, disburses funds, and you receive keys and possession per the contract.
Deposits and protections
Earnest money basics
Your earnest money deposit shows good faith and ties you to the contract. Amounts vary by price point and market conditions. In competitive San Gabriel Valley markets, buyers sometimes increase deposits to strengthen offers. Escrow holds the deposit and releases it according to the contract or a written agreement.
If you cancel within a valid contingency window, contracts typically direct escrow to return your deposit. If you default without a contractual right, the seller may have remedies under the agreement. Your agent will explain deposit exposure before you remove contingencies.
Common contingencies
- Inspection contingency lets you investigate and request repairs or cancel within the period.
- Loan contingency protects you if you cannot obtain financing by the deadline.
- Appraisal contingency allows solutions if the appraisal is below the purchase price.
- Title contingency gives you time to review title and object to defects.
- HOA document review applies to condos and planned communities and follows statutory timelines.
Inspections in the San Gabriel Valley
Southern California transactions often include termite inspections and reports. In older San Gabriel Valley neighborhoods, sewer scopes and focused foundation reviews are common due to older systems. You might also consider roof, HVAC, pool or spa, and other specialty inspections.
If issues arise, you can request seller repairs, a price adjustment, or a credit through escrow at closing. Many sellers prefer credits rather than doing work during escrow. If repairs must be completed later, escrow can sometimes hold a reserve, but only with clear written instructions from both sides.
Appraisal and loan milestones
The appraisal is ordered by your lender and supports the loan amount. Underwriting reviews your income, assets, and property documents. Stay responsive to lender requests to avoid delays. If value comes in low, your options are to renegotiate, add cash, contest through your lender with market data, or cancel if your appraisal contingency allows it.
For financed buyers, the Closing Disclosure must be provided at least three business days before closing. Review it carefully. Compare it to your loan estimate and ask your lender and escrow officer to explain differences.
Title, documents, and recording
Title work and insurance
Your Preliminary Title Report lists recorded liens, easements, and exceptions. Before closing, escrow coordinates the clearance of items such as unreleased loans or judgments. At closing, the title company issues an owner’s policy and a lender’s policy if you have a mortgage.
Documents you will sign
You can expect to sign a grant deed transferring ownership to you, a deed of trust and note if you are financing, final escrow instructions, the settlement statement, and standard affidavits or disclosures. Your lender package includes the note, security instrument, and required federal disclosures. After funding, escrow records your deed and deed of trust with the county recorder and then disburses funds.
Closing costs: who usually pays
Who pays which fees is set by the contract and local custom. In many Southern California transactions, buyers often pay their loan fees, lender’s title policy, appraisal, recording of the deed of trust, homeowner’s insurance, and prepaid interest. Sellers often pay the owner’s title policy, their share of escrow fees, real estate commissions, and payoff of existing loans. Escrow fees are commonly split, though practices vary by deal.
Local San Gabriel Valley norms
- Competitive segments may push for shorter inspection windows, higher deposits, or fewer contingencies.
- Financed escrows often run 30 to 45 days, but some sellers prefer 21 to 30 days. All-cash closings can be faster.
- Termite reports are common, and credits for treatment or repairs are frequently negotiated.
- Older homes may need sewer or foundation specialists to avoid surprises.
How your team adds value
A skilled local agent helps you structure contingency timelines, deposit levels, and repair strategies that fit market conditions. Your escrow officer coordinates signatures, funding, and recording and prepares clear instructions if a repair holdback is needed. Your lender manages the appraisal and underwriting schedule to prevent last-minute delays. Early involvement of inspectors and, when needed, title counsel can save time and stress.
Reduce risks and delays
- Calendar every contingency deadline on day one.
- Order inspections immediately and follow up on specialist recommendations.
- Respond quickly to lender and escrow requests.
- Review the Preliminary Title Report early and ask questions.
- If you plan a repair credit or holdback, get it in writing with specific amounts and timelines.
- Always verify wiring instructions directly with your escrow officer using known contact information.
Final checklist
- Initial deposit delivered to escrow within contract window.
- Inspections ordered and reviewed within contingency period.
- Appraisal completed and loan conditions satisfied.
- Title issues cleared or accepted as exceptions.
- Contingencies removed in writing by deadlines.
- Closing Disclosure reviewed at least three business days before closing if financed.
- Signing, funding, recording, and possession confirmed with escrow.
Buying in the San Gabriel Valley should feel organized and predictable. With the right plan, escrow becomes a clear path from offer to ownership. If you want a senior-led team that understands local timelines, negotiation norms, and white-glove execution, connect with Gus Ruelas to discuss your next move.
FAQs
What is escrow in a California home purchase?
- Escrow is a neutral process where a third party holds funds and documents, coordinates conditions in the contract, and manages recording and disbursement at closing.
How long does escrow take in the San Gabriel Valley?
- Financed purchases commonly run 30 to 45 days, while sellers may prefer 21 to 30 days in competitive markets; all-cash deals can close faster.
When is the earnest money deposit due in California?
- Your initial deposit is usually due to escrow within 1 to 3 business days after offer acceptance, per the timelines set in your purchase agreement.
What inspections are common for San Gabriel Valley homes?
- General home and termite inspections are common, with roof, sewer scope, HVAC, foundation, and pool or spa inspections added as needed, especially for older properties.
What happens if the appraisal comes in low in California?
- You can renegotiate price, bring additional cash, challenge the appraisal through your lender, or cancel under an appraisal contingency if your contract allows it.
Who pays closing costs in Southern California?
- Buyers often pay loan-related fees, lender’s title policy, appraisal, and insurance, while sellers often pay the owner’s title policy, commissions, and their escrow share; practices vary by deal.
When do I get keys after closing in Los Angeles County?
- You typically receive keys when escrow confirms recording and funding, or as otherwise specified in your purchase contract’s possession terms.
