Changed Date

September 15, 2004, Change 4

This section has been changed to create subsection lettering.

a. General

In some instances, it may not be possible to complete certain items before the veteran wishes to move into the property.  The escrow of funds can permit the veteran-purchaser to gain occupancy of the dwelling prior to completion of certain items which must be postponed due to weather conditions or other circumstances.  Such items include, but are not limited to

·   walkways, driveways, and retaining walls

·   exterior painting

·   landscaping

·   garages

·   street paving and offsite drainage, and

·   public sidewalks.

VA may permit the escrow of funds necessary to complete the unfinished work later, and still issue evidence of guaranty.

b. What is an Escrow?

An escrow involves

·   withholding 1 1/2 times the dollar amount necessary to complete the postponed items (as estimated by a third party) from the proceeds due the seller at closing

·   holding the escrowing funds in a proper, secure manner, and

·   releasing the funds once the postponed items have been satisfactorily completed.