A claim is an issue brought forth after closing by the buyer or a third party. Claims can be the result of a perceived breach in the representations and warranties outlined in the transaction agreement. When a claim is presented, a dollar amount is specified and that amount of the escrow must be set aside until the claim is resolved. If the release date passes while there is still a pending claim, the remaining money will be distributed accordingly within 7-10 business days of the release date. Once the claim is resolved (and assuming there are funds still to be distributed from the money set aside), a new release will occur and funds from the secondary release will be distributed within approximately 7-10 business days of the claim resolution. Your revised release amount is based on your pro-ratas as stated in the transaction agreement.
To view a typical escrow release timeline, click here.
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Posted in: Clients: General Information