Real Estate Dictionary: What Do Escrow, POA, and Underwriter Mean?

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Navigating real estate transactions in the U.S. involves a lot of unfamiliar terms—especially if you’re an international buyer. In today’s edition of our Real Estate Dictionary, we’re breaking down three important terms you’ll encounter in the buying process: Escrow, Power of Attorney (POA), and Underwriter.

Understanding these terms can help you feel more confident and better prepared when investing in Miami real estate.

What Is Escrow?

Escrow refers to a neutral third-party account where money or documents are held during a real estate transaction.

How it works:

• When a buyer and seller agree on a property, the buyer deposits funds (like the earnest money) into an escrow account.
• The escrow company holds the money safely and impartially until all contract terms are fulfilled.
• Once the transaction is complete, the escrow agent releases the funds accordingly.

📌 Why it matters: Escrow protects both the buyer and the seller by ensuring no funds are released until all legal and contractual obligations are met.

What Is Power of Attorney (POA)?

A Power of Attorney (POA) is a legal document that allows someone else (called your attorney-in-fact) to act on your behalf during a real estate transaction.

Types:

• General POA: Grants broad authority across financial/legal matters.
• Limited or Specific POA: Grants permission for a specific action—like signing a deed or closing documents.

📌 Why it matters: If you live abroad or can’t be physically present for the closing, a POA allows your trusted representative (like a lawyer or family member) to sign and finalize documents for you.

What Is an Underwriter?

An underwriter is the person (or department) who evaluates your loan application on behalf of the lender.

They review:

• Credit history
• Income and assets
• Property appraisal
• Overall risk

📌 Why it matters: The underwriter is the final decision-maker who approves or denies your mortgage. Their job is to ensure the loan meets all guidelines and that you’re a qualified borrower.

Fernanda Zomignani’s Tip

Understanding these terms is key to a smooth and secure real estate experience—especially if you’re purchasing from abroad. With the right guidance and a trusted team by your side, navigating U.S. real estate becomes much easier.

Need help understanding the real estate process from start to finish? Contact Fernanda Zomignani, your trusted Miami real estate advisor, for expert guidance every step of the way.

Reach out now to schedule your free consultation.