OT: stupid question, Escrow? |
|
Porsche, and the Porsche crest are registered trademarks of Dr. Ing. h.c. F. Porsche AG.
This site is not affiliated with Porsche in any way. Its only purpose is to provide an online forum for car enthusiasts. All other trademarks are property of their respective owners. |
|
OT: stupid question, Escrow? |
SirAndy |
May 23 2008, 05:25 PM
Post
#1
|
Resident German Group: Admin Posts: 41,813 Joined: 21-January 03 From: Oakland, Kalifornia Member No.: 179 Region Association: Northern California |
How exactly does Escrow work? (IMG:style_emoticons/default/idea.gif) from what i gather, the escrow company is kinda like a Notary with a Bank and i put in the funds and they'll hold them until certain terms in the sales contract are fulfilled and then release the funds to the seller ... am i close? (IMG:style_emoticons/default/shades.gif) Andy |
race914 |
May 23 2008, 05:34 PM
Post
#2
|
73 914-4 Group: Members Posts: 1,006 Joined: 31-October 05 From: Nipomo, California (Central Coast) Member No.: 5,027 Region Association: Central California |
How exactly does Escrow work? (IMG:style_emoticons/default/idea.gif) from what i gather, the escrow company is kinda like a Notary with a Bank and i put in the funds and they'll hold them until certain terms in the sales contract are fulfilled and then release the funds to the seller ... am i close? (IMG:style_emoticons/default/shades.gif) Andy And then they transfer the ownership papers to you. |
HeavyHeavy |
May 23 2008, 05:36 PM
Post
#3
|
Member Group: Members Posts: 62 Joined: 7-June 06 From: Albuquerque Member No.: 6,177 |
More or less. It depends a little on the context.
Let's say you purchase a house on a real estate contract (as opposed to a normal closing where you would receive a deed right away). In a deal like that, the owner of the property holds the note and is still on the hook for paying that while the buyer on the real estate contract takes possession and makes payments - usually to an escrow company. It is the duty of the escrow company to accept the monthly payments and either put it toward the owner's mortgage or pay the owner so he can do it. The escrow company is basically a disinterested third party that makes sure both sides are getting a fair shake. In the example of the real estate contract, the escrow company holds a warranty deed and a special warranty deed. If the buyer pays off the real estate contract, the escrow company will make sure that the warranty deed from the seller to the buyer gets recorded at the county clerk's office. If the buyer defaults, the escrow company records the special warranty deed from the buyer back to the seller. An escrow officer usually works at a title company and not an escrow company (at least here that's how it works). The job of an escrow officer is to do the closing, but is still just a disinterested third party that makes sure everyone involved in the transaction gets a fair shake. Jamie |
sww914 |
May 23 2008, 05:36 PM
Post
#4
|
Advanced Member Group: Members Posts: 2,439 Joined: 4-June 06 Member No.: 6,146 Region Association: None |
Yes. They're the impartial money holders. After the title people verify that all of the 6' thick pile of paperwork is complete they will release the money. In the case of my home purchase they held on to the $4500.00 that was earmarked for the termite damage repair jerkoffs until I said that they could release it after 6 months. That's how long it took to get them to finish the job that they started. It had to do in part with them trying to bondo up a hole in the shower wall and for some reason I wouldn't accept that as a good repair.
|
TROJANMAN |
May 23 2008, 05:49 PM
Post
#5
|
Looks nice in pictures......... Group: Members Posts: 5,275 Joined: 5-March 04 From: Colorado Member No.: 1,753 Region Association: None |
My uncle in Nigeria has an escrow company that comes highly recommended. (IMG:style_emoticons/default/biggrin.gif)
But what they said. If this is a real estate transaction the escrow company, more or less, guarantees clear title and acts as a non-interested third party to facilitate the transaction. |
SirAndy |
May 23 2008, 06:21 PM
Post
#6
|
Resident German Group: Admin Posts: 41,813 Joined: 21-January 03 From: Oakland, Kalifornia Member No.: 179 Region Association: Northern California |
not for real estate ...
i'm buying the liquor license from the previous owner and the transfer usually takes some time. i'm planning on putting the money for the license into escrow until the transfer of the license is completed. i drafted up a agreement that states, among other things, that if (for whatever reason) the transfer does not complete, he'll get no money. well, that's the plan anyways ... (IMG:style_emoticons/default/biggrin.gif) Andy |
HeavyHeavy |
May 23 2008, 06:34 PM
Post
#7
|
Member Group: Members Posts: 62 Joined: 7-June 06 From: Albuquerque Member No.: 6,177 |
I'm sure it's the same concept then. The escrow company
will pay the previous owner the money that you put into escrow when it determines that the liquor license can be handed over to you without also handing over any problems that the previous owner should take care of. They need to make sure that you are not purchasing problems along with your liquor license |
Pat Garvey |
May 23 2008, 06:37 PM
Post
#8
|
Do I or don't I...........? Group: Members Posts: 5,899 Joined: 24-March 06 From: SE PA, near Philly Member No.: 5,765 Region Association: North East States |
Well, an escrow agreement is definitely NOT limited to real estate, liquor license agreements. An escrow agreement is a bond. You, by abiding by the agreement, have stated that you will pay a sum upon agreement of terms.
Yes, the agent is a third party, and they do collect a fee (though it's usually nominal). Escrow can be used for real estate, tax, liscense, fines (don't ask how I know about this one). You place a certain amount of funds with an agent, guaranteeing they are available to complete the transaction. Once all the terms have been met, you ask the agent (in writing) to release the funds. Deal done. It's actually a pretty simple & inexpensive process. Everyone goes home happy. Pat |
ericread |
May 23 2008, 06:37 PM
Post
#9
|
The Viper Blue 914 Group: Members Posts: 2,177 Joined: 7-December 07 From: Irvine, CA (The OC) Member No.: 8,432 Region Association: Southern California |
not for real estate ... i'm buying the liquor license from the previous owner and the transfer usually takes some time. i'm planning on putting the money for the license into escrow until the transfer of the license is completed. i drafted up a agreement that states, among other things, that if (for whatever reason) the transfer does not complete, he'll get no money. well, that's the plan anyways ... (IMG:style_emoticons/default/biggrin.gif) Andy Escrow is only as strong as the escrow contract. Speak to an ecrow company or two and ask them to provide contract documentation. Look for a company that provides commercial escrow services. |
rhodyguy |
May 23 2008, 10:49 PM
Post
#10
|
Chimp Sanctuary NW. Check it out. Group: Members Posts: 22,188 Joined: 2-March 03 From: Orion's Bell. The BELL! Member No.: 378 Region Association: Galt's Gulch |
the escrow co should provide info as to any liens. you don't want to be assuming anyone else's headache. do you have an attorney?
|
DNHunt |
May 24 2008, 08:05 AM
Post
#11
|
914 Wizard? No way. I got too much to learn. Group: Members Posts: 4,099 Joined: 21-April 03 From: Gig Harbor, WA Member No.: 598 |
Just my opinion, If you are buying a business get an attorney.
Dave |
Cap'n Krusty |
May 24 2008, 12:08 PM
Post
#12
|
Cap'n Krusty Group: Members Posts: 10,794 Joined: 24-June 04 From: Santa Maria, CA Member No.: 2,246 Region Association: Central California |
Escrow protects both the buyer and the seller. If there's a cloud on the liquor license, the buyer is protected. If the buyer can't qualify for the license, the seller is protected (so's the buyer). You NEED a third party to handle that stuff for you so nobody gets burned, and the sale goes through smoothly and legally. BTW, you wanna be sure any plans you have for the establishment comply with the zoning laws and the conditional use permit, that you have a fictitious business name on file with the county, that you have your sales tax and business license requirements fulfilled, and that the city and the state will allow the transfer. Also that the seller doesn't have any undisclosed financial or legal baggage that will affect YOU after the sale. THAT'S what an escrow agent does for you. The Cap'n
|
Katmanken |
May 24 2008, 12:12 PM
Post
#13
|
You haven't seen me if anybody asks... Group: Members Posts: 4,738 Joined: 14-June 03 From: USA Member No.: 819 Region Association: Upper MidWest |
And escrow says you are serious enough about the transaction to put up money, and not a tire kicker....
Ken |
SirAndy |
May 24 2008, 02:38 PM
Post
#14
|
Resident German Group: Admin Posts: 41,813 Joined: 21-January 03 From: Oakland, Kalifornia Member No.: 179 Region Association: Northern California |
yes, i do have an attorney. i just wanted to make sure i understand how things work.
attorneys have the tendency to use a lot of words i am not familiar with ... (IMG:style_emoticons/default/rolleyes.gif) i started a s-corp to run the club, been talking to the city about zoning, inspections and permits. got my attorney to review the agreements and contracts. just got off the phone with the escrow agent who handled the license transfer for the club in the past. no outstanding issues with the club or the previous tenant. i might get hit with some additional sound proofing work to pass the cabaret license inspection. the city hinted at that, there have been noise complaints in the past from one neighbour (go figure, there's always that one guy) ... anyways, everything looks good to go, talked to the previous tenant at length yesterday and got a lot of good info on the place. plus, we sipped some of the over $10k of booze he had stashed in his garage. (IMG:style_emoticons/default/biggrin.gif) (IMG:style_emoticons/default/stirthepot.gif) Andy |
yellow914 |
May 24 2008, 10:44 PM
Post
#15
|
Member Group: Members Posts: 183 Joined: 28-March 08 From: San Jose, CA Member No.: 8,861 Region Association: Northern California |
in a business escrow it is typically handled by an escro company that specializes in licens transfer and also mobile homes as they are not real property (usually)
the ABC will no doubt want a rectal exame from both you and the seller to make sure there is no reason for them to not approve of this transfer...aaaaaalsoooo if you have any DUI's it could be more difficultbest of luck on your new business once to conquor the red tape...... (IMG:style_emoticons/default/beerchug.gif) |
Lo-Fi Version | Time is now: 24th September 2024 - 01:30 PM |
All rights reserved 914World.com © since 2002 |
914World.com is the fastest growing online 914 community! We have it all, classifieds, events, forums, vendors, parts, autocross, racing, technical articles, events calendar, newsletter, restoration, gallery, archives, history and more for your Porsche 914 ... |