Hit a Snag In the Homebuying Process? An Escrow Holdback May Be the Answer
Sometimes, a seller can’t get repairs done before the closing date or a builder can’t finish a project on time. With an escrow holdback, you can still close on schedule.
If both parties agree, a portion of the seller’s proceeds can be put into escrow to cover the cost of repairs.
Your mortgage lender will have to approve an escrow holdback agreement.
The lender will probably approve your request if the property only needs minor work. It might refuse if the house is unhealthy or unsafe.
If your lender approves an escrow holdback, it will most likely require extra funds to cover unforeseen problems and to motivate the seller to get the work done promptly.
If you run into a problem, talk to your real estate agent and lender to find out if an escrow holdback is the solution.
