FIELD NOTESJUN 22, 2026 · PAUL BLAIR

How Escrow Works in California: A Seller's Guide for Los Angeles

California escrow takes 30–45 days and works differently than most states. Here's exactly what LA sellers experience from accepted offer to funded wire.

How Does Escrow Work in California When You Sell Your Home?

In California, once you accept an offer, the transaction runs through an escrow company, a neutral third party that holds all funds and documents until every condition in the contract is met. Escrow typically takes 30 to 45 days for a financed purchase in Los Angeles. The process covers everything from the buyer's deposit to your disclosure package to the final deed recording at the county. You won't receive your net proceeds until the deed records with the Los Angeles County Recorder. Not when you sign your closing documents.

By Paul Blair | June 22, 2026

California escrow confuses nearly every seller the first time through it. You've accepted an offer. You're packing boxes. And then you hear: "Escrow is going to take about 35 days, and you'll sign your documents a few days before the close date. You won't get your wire until after the deed records."

What does that actually mean? Why does it work this way? And what are you supposed to be doing for the next five weeks?

Here's the full picture, from the day you accept an offer to the day the money lands.

Why California Uses Escrow and What Makes It Different

In most East Coast states, a real estate attorney coordinates the closing. In California, that role belongs to a licensed escrow officer. The escrow company is a neutral intermediary. They don't represent you or the buyer. Their job is to hold funds, collect documents, follow the instructions in the purchase agreement, and make sure both sides have satisfied every condition before the deal closes.

There's also a title company involved, but this is where sellers get confused: in California, escrow and title are separate functions. The escrow officer coordinates the transaction. The title company issues the title insurance policy and handles the search for any liens or claims on the property. They often operate as sister companies, but they're legally distinct roles.

One more California-specific wrinkle: California is a "dry funding" state, which means the lender does not fund the loan at the document signing appointment. Funds come from the lender after the documents are reviewed and accepted, and the deed records with the county the following business day. This is different from most other states, where closing and funding happen at the same table on the same day.

The Escrow Timeline: What Happens and When

Day 1–3: Escrow Opens

After both parties sign the purchase agreement, your agent (or the buyer's agent) opens escrow with the selected escrow company. The buyer deposits their earnest money (typically 3% of the purchase price in California) into the escrow account. Under California's liquidated damages clause (Civil Code §1677), that 3% is the maximum the seller can keep if the buyer defaults after contingency removal.

At this stage, the escrow officer sends instructions to both sides and begins coordinating the logistics of the transaction.

Days 1–17: Disclosures and Inspections

California law requires sellers to deliver a substantial disclosure package to the buyer. This is not optional, and it is not something to rush. The standard package includes:

TDS: Transfer Disclosure Statement. Your written account of known material defects, repairs, and the property's condition.
SPQ: Seller Property Questionnaire. A companion form that goes deeper on specific issues.
NHD: Natural Hazard Disclosure. A third-party report identifying whether the property falls within flood zones, fire severity zones, earthquake fault zones, or other designated hazard areas. Critical for hillside, canyon, and coastal properties in LA.
Any city- or county-specific disclosures. Los Angeles sellers also need to address Measure ULA exposure on sales above the current thresholds ($5,400,000 and $10,900,000, effective July 1, 2026), as well as the soft-story retrofit ordinance if the property has additional units, and wildfire defensible-space requirements under AB 38 for properties in Very High Fire Hazard Severity Zones.

The buyer has a 17-day investigation period from acceptance to complete their inspections, review your disclosures, and decide whether to proceed. During this window, you need to provide access to inspectors, the appraiser, and the lender's underwriter if requested.

For a deeper look at the NHD specifically, the Natural Hazard Disclosure in Los Angeles post breaks down what each zone designation means for your sale.

Days 7–21: Loan Processing

While the buyer's lender processes the loan, escrow is collecting additional documents on your side: your mortgage payoff statement, HOA documents if applicable, and any items the title search identifies (liens, judgments, unpermitted work that needs to be addressed). Your agent will help coordinate, but you should be prepared to respond quickly if the escrow officer or lender requests anything.

Days 14–17: Contingency Removal

When the buyer is satisfied with inspections, disclosures, and has their loan in order, they remove their contingencies in writing on a CAR Form CR (Contingency Removal). In California, contingencies must be removed in writing. A verbal "we're good" doesn't count.

There are three primary contingencies:

Inspection contingency (the buyer accepts the property's condition)
Appraisal contingency (the property appraised at or above the purchase price)
Loan contingency (the buyer has final loan approval)

Until all three are removed, the buyer can cancel and recover their deposit. Once removed, if the buyer walks without a legally valid reason, you can pursue the earnest money deposit as liquidated damages. The contingency removal post covers the written removal process and the risks in detail.

Days 25–30: Document Signing

This is where California surprises most sellers. You and the buyer do not sit at the same closing table. You sign your closing documents separately from the buyer, typically at a notary's office or through a mobile notary, usually two to three days before the actual close of escrow date.

Your signing package includes the grant deed transferring title to the buyer, a settlement statement showing exactly what you'll net after all costs (payoff of your existing mortgage, commissions, escrow and title fees, transfer taxes, any Measure ULA tax, prorated property taxes, and any other credits or debits), a FIRPTA certification if applicable, and a few other standard documents.

Read your settlement statement carefully before you sign. This is your final accounting. If a number looks wrong, flag it with your agent and the escrow officer before you sign.

Days 30–33: Funding and Recording

After all documents are signed and the buyer's lender gives final approval, the lender wires the loan proceeds to the escrow account. This is called funding. Once funded, the grant deed goes to the LA County Recorder's office for recording. This typically happens the next business day.

The close of escrow is the day the deed records. Not the day you signed. Not the day the buyer signed. The official close is when the county posts the deed in the public record and ownership legally transfers.

After recording, the escrow officer disburses funds in this order: your existing mortgage(s) are paid off, then commissions, then escrow and title fees, then any transfer taxes (including Measure ULA if applicable), and finally your net proceeds are wired to you.

When Does Your Wire Arrive?

If the deed records before noon in LA County, you will typically receive your wire the same day. If it records in the afternoon, the wire often arrives the next business day. Wires have a cutoff of around 1pm PST for same-day delivery. If you're counting on funds for a specific date (a simultaneous purchase, a wire to an exchange account, a payoff), talk to your escrow officer about the recording timeline in advance.

What the Seller Pays in Escrow

The escrow settlement statement will show every line item. For LA sellers, the typical charges include:

Listing agent commission
Buyer's agent commission (if you've agreed to pay it, now negotiated in the contract rather than set on the MLS)
Escrow fee (typically split 50/50 between buyer and seller)
Owner's title insurance policy (in Southern California, the seller customarily pays this)
Documentary transfer tax (LA County base rate: $1.10 per $1,000 of value)
Measure ULA transfer tax if the sale price exceeds the current city thresholds
Payoff of your existing mortgage(s) plus accrued interest
Prorated property taxes for your portion of the tax year
HOA transfer fees and any HOA dues owed
Any agreed-upon repair credits or closing cost concessions

For a full cost breakdown and a net proceeds estimate at your specific price point, the What LA Sellers Pay at Closing post runs through the numbers in detail.

Common Escrow Delays and How to Avoid Them

Thirty-day escrows go sideways for predictable reasons. Here are the most common:

Slow disclosure delivery. If you wait until Day 10 to deliver your TDS, SPQ, and NHD, the buyer's clock hasn't started yet, and you've lost ten days of your timeline. Get disclosures delivered as early as possible. Aim for within 3 to 5 days of opening escrow.

Appraisal issues. If the property appraises below the purchase price and the buyer has an appraisal contingency, you'll be negotiating a price adjustment or waiting for a second appraisal. This can add 7 to 10 days.

Lender delays. Loan conditions, underwriting requests, and last-minute document requests from the lender are the most common cause of escrow extensions. Your buyer's financing quality matters as much as the offer price.

Unpermitted work. If a title search surfaces unpermitted additions or structures that weren't disclosed, escrow can pause while those issues are addressed. The selling with unpermitted work post covers your options.

Title issues. Old liens, judgments, or estate issues that didn't surface until the title search can delay recording. These usually aren't deal-killers, but they take time to resolve.

A Note for Non-US Sellers

If you're a foreign national selling a Los Angeles property, FIRPTA withholding applies. The buyer is required to withhold 15% of the gross sale price (not your gain, the full price) and remit it to the IRS. California also requires a separate 3.33% state withholding on Form 593. This is handled through escrow, but it requires additional documentation and often a Form 8288-B application for a reduced withholding certificate if your actual tax liability is lower than the withholding amount. The FIRPTA in Los Angeles post covers this in full.

Frequently Asked Questions

How long does escrow take in Los Angeles?

For a financed purchase, most Los Angeles escrows close in 30 to 45 days. Cash transactions can close in 10 to 14 days because there's no lender involved. Thirty days is achievable, but it requires both sides to move quickly on disclosures, inspections, and document requests.

Do buyers and sellers ever sit at the same closing table in California?

No. In California, buyers and sellers sign their closing documents separately, usually at a notary's office or through a mobile notary, typically two to three days before the actual close of escrow date. The "close" is when the deed records with the county, not when documents are signed.

Who chooses the escrow company in Los Angeles?

Typically the seller, since the listing side often has a preferred vendor relationship. However, escrow is fully negotiable between the parties. The buyer can request a specific escrow company, and it's common for the parties to agree on one. Unlike some states, California does not require an attorney to oversee the closing. The escrow officer handles the process.

What is the difference between escrow and title in California?

Escrow and title are separate functions. The escrow officer is a neutral coordinator who holds funds, collects documents, and manages the transaction timeline. The title company researches the property's ownership history, identifies any liens or claims, and issues the title insurance policy that protects against those claims. They often work together through affiliated companies, but they are legally distinct services.

When does the seller receive their net proceeds?

After the deed records with the LA County Recorder, the escrow officer disburses funds. If the deed records before noon, the seller typically receives their wire the same day. If it records in the afternoon, the wire usually arrives the following business day. Wire transfers have processing cutoffs around 1pm PST.

If you're thinking about selling in Los Angeles and want to walk through what your specific timeline and net sheet would look like, I'm happy to put that together. Reach out anytime or request a home value estimate to start the conversation.

About Paul Blair

Paul Blair is the founder and broker of Grey Square, a virtual real estate brokerage representing buyers and sellers across Dallas and Los Angeles. With 22 years in the business and more than $200 million in closed transactions, Paul works the full range of the market, from luxury homes in the Park Cities and Preston Hollow to estates in the Hollywood Hills and across the Westside. Connect with Paul and the Grey Square team at greysq.com. TX TREC #9011505 · CA DRE #01792671.