What do both the buyer and seller need to negotiate in order to have a smooth escrow process?

For a smooth escrow process, negotiating the division of closing costs is crucial because it directly affects the financial aspects of the transaction and helps set clear expectations between the buyer and seller. Closing costs can include various fees such as lender fees, title insurance, appraisal fees, and taxes, and their allocation can vary significantly based on local customs or specific contractual agreements.

When both parties come to an understanding on how these costs will be shared, it minimizes the potential for disputes and ensures that each side knows their financial obligations moving forward in the transaction. A clear agreement on closing costs can lead to a more streamlined process as it allows for proper budgeting and financial planning before the closing date.

While the other options like inspection timelines, title insurance requirements, and earnest money amount are also important components of a real estate transaction, they do not have the same overarching impact on the escrow process as understanding and agreeing on closing costs does.