Refinance
Home Title and Trust Company is a full-service escrow company firm.
Refinance
How Does Escrow Work When Refinancing?
Understanding the escrow process is important when refinancing your home. Since real-estate transactions include long, multifaceted steps, escrow agents are in place to help refinancers and lenders track and disburse money according to the agreements made.
However, many are unsure of the specifics of the escrow process when refinancing a home. In this article, we explain what an escrow agent does during a home refinance and what it means for your money.
When do I use Escrow for a Home Refinance?
In a refinance, a homeowner replaces his or her current mortgage with a new mortgage. The new mortgage often comes with more favorable terms to the borrower than those of the current mortgage.
When the new mortgage has been finalized with a new lender, that lender will then make use of the escrow process to disburse money to the old lender to cover the old mortgage.
However, many want to know what the exact steps are in an escrow process during refinancing. When do you stop paying interest on your old loan and when do you start paying interest on your new loan in a home refinancing process?
