An escrow may be terminated according to the escrow agreement when the parties have performed the conditions of the escrow and the escrow agent has delivered the items to the parties entitled to them according to the escrow instructions. An escrow may be prematurely terminated by cancellation after default by one of the parties or by mutual consent. An escrow may also be terminated at the end of a specified period if the parties have not completed it within that time and have not extended the time for performance.
Florida Instructions to Title Company to Cancel Escrow and Disburse the Funds held in Escrow Title companies play a crucial role in real estate transactions, particularly in Florida where escrow services are commonly used to protect the interests of the buyer, seller, and lender. However, there may arise situations where it becomes necessary to cancel the escrow agreement and disburse the funds held in escrow. This comprehensive guide outlines the process of instructing a Florida title company to cancel escrow and disburse the funds, ensuring a smooth and efficient resolution to the escrow arrangement. 1. Types of Florida Instructions to Title Company to Cancel Escrow and Disburse the Funds held in Escrow: a) Cancellation due to Contract Termination: In the event of contract termination, whether initiated by the buyer or seller, specific instructions need to be provided to the title company to cancel the escrow and disburse the funds. This ensures that any earnest money or additional deposits made during the transaction are returned to the appropriate party. b) Cancellation due to Seller Default: If the seller fails to meet their contractual obligations, such as failing to complete required repairs or failing to clear title issues, the buyer may have the right to cancel the escrow and request the release of funds held. Clear instructions must be given to the title company to ensure a proper return of funds to the buyer. c) Cancellation due to Financing Contingency: In cases where a buyer's loan application is denied or the lender fails to provide financing within the agreed-upon timeframe, the buyer may exercise their right to cancel the escrow and seek the return of their funds. Specific instructions must be provided to the title company to initiate the cancellation and disbursement process. d) Cancellation due to Force Mature Events: Unforeseen events, such as natural disasters, pandemic-related issues, or government-initiated restrictions, may make it impossible for a real estate transaction to proceed. In such cases, instructions should be given to the title company to cancel escrow and disburse the funds held, considering the circumstances of the cancellation. 2. Instructions to Title Company to Cancel Escrow and Disburse the Funds held in Escrow: a) Clear Identification: Begin the instructions by providing clear identification of the parties involved, including the buyer, seller, lender (if applicable), and title company. Include relevant transaction details, such as the property address, escrow account number, and any pertinent reference numbers. b) Reason for Cancellation: Clearly state the reason for canceling the escrow, whether it is due to contract termination, seller default, financing contingency, or force majeure events. Provide a brief summary of the circumstances leading to the cancellation to help the title company understand the situation fully. c) Fund Disbursement: Outline the desired disbursement of funds held in escrow. Specify the amount to be returned to the buyer, addressing any prorated amounts, adjustments, or fees that may apply. Instruct the title company to prepare any necessary documents or checks and deliver them to the appropriate parties involved. d) Communication with Parties: Include instructions for the title company to communicate with the parties involved, including any necessary notifications or disclosures required by law or contractual obligations. Specify whether any final settlement statements or documents need to be distributed to the buyer, seller, or lender. e) Timeframe and Acknowledgment: Clearly define the timeframe within which the title company should process the cancellation and disbursement request. Include a section for the authorized representatives of the parties involved to acknowledge and sign the instructions, ensuring their agreement with the cancellation and disbursement terms. In conclusion, when instructing a Florida title company to cancel escrow and disburse the funds held in escrow, it is essential to provide clear identification of the parties, state the reason for cancellation, outline fund disbursement details, communicate with all relevant parties, and establish a timeframe for completion. By following these guidelines, real estate transactions in Florida can be effectively terminated, and funds can be disbursed appropriately, safeguarding the interests of all parties involved.
