Fill and Sign the Escrow Contract Form

Escrow Agreement regarding Deposit to Fund Completion of Construction of Residential Property under Construction Contract with no Construction Loan This Escrow Agreement is made _______________ (date of agreement), between _____________________ (name of husband) and ____________________ (name of wife), husband and wife, of ___________________________________________________________ (address of owners) , hereinafter called the Owners , ___________________________ (name of contractor) , corporation organized and existing under the laws of ___________________ (name of state) , with its principal office located at ____________________________________ _________________________ (address of contractor), hereinafter called the Contractor, and ______________________ (name of escrow agent), a corporation organized and existing under the laws of __________________ (name of state), with its principal office located at _____________________________________________________ (address of escrow agent), hereinafter called the Escrow Agent. Whereas, the Owners have entered into a contract with ________________________ (name of general contractor) , hereinafter called the General Contractor , for the construction of a residential dwelling on property covered by Title Insurance Commitment No. ______________ (commitment number) issued by the Escrow Agent, hereinafter called the Title Commitment , at a total cost of $__________ (dollar amount of contract price) , hereinafter called the Contract Price ; and Whereas, the Owners have paid the General Contractor a deposit of $________ (dollar amount of deposit) ; and Total funds available for construction (less the deposit) will be $_________ (dollar amount of total funds available for construction) and will be deposited with the Escrow Agent in escrow from time to time in such installments as shall be agreed upon between the General Contractor and the Owners; Now, therefore, for and in consideration of the mutual covenants contained in this agreement, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: 1. The Escrow Agent is directed to disburse all funds deposited in this escrow to the General Contractor , securing at the time of each respective disbursement a General Contractor 's draw request duly authorized and approved by the Owners and proper waivers of lien, on condition that the exception as to unfiled construction liens noted in the Title Commitment for the Owners ' policy will be eliminated only as to lienable claims in favor of the General Contractor and subcontractors listed on such draw request. 2. The Escrow Agent is authorized to enter upon the property to conduct inspections on behalf of the Owners for the purpose of determining whether payment to the General Contractor is warranted. It is understood that the inspections, which the Escrow Agent may conduct, are for the purpose of assuring the Owners that the stage of construction substantially justifies payment to the General Contractor . The Owners acknowledge that it will be their responsibility to assure themselves that the quality of workmanship and materials is satisfactory and that the dwelling is built in accordance with such plans and specifications. The Owners further acknowledge and agree that it is not the Escrow Agent's obligation to make any assurances to them as to the quality of workmanship and materials and that the Escrow Agent has no liability to them for any alleged defect or defects in quality or for any failure to complete the dwelling in accordance with such plans and specifications. 3. In accepting this escrow, the Escrow Agent is relieved from any liability if it disburses part of the funds here deposited and then discovers that the remaining undisbursed balance will be insufficient to complete the construction work, free and clear of construction lien claims, either because of extras ordered by the Owners for which no additional funds have been deposited in escrow or because the General Contractor is unable to complete the construction work for the Contract Price . 4. The Owners agree to advise the Escrow Agent promptly if they receive from any contractor, subcontractor, or material suppliers: A. An initial notice that the contractor, subcontractor, or material suppliers or will furnish labor and/or materials; or B. A notice of intention to file a lien claim; or C. A notice of the filing of a lien claim in connection with the construction. 5. The Owners agree that they will promptly reimburse the Escrow Agent for any expenses that it may reasonably and necessarily incur in prosecuting or defending any action to which it may be a party as a result of a dispute with reference to the rights of anyone claiming an interest in the funds deposited under this Agreement. In the event of a civil action or arbitration regarding this Agreement between the parties to this Agreement, the losing party shall, as apportioned by the court or arbitration body, pay the winning party for any costs, including reasonable attorney's fees. 6. It is agreed that an escrow and inspection fee of $_________ (dollar amount of escrow and inspection fee) will be paid by the Owners for up to _______ (number of draw requests) draw requests and an additional fee of $________ (dollar amount of fee per additional draw) will be paid by the Owners for each additional draw request. 7. The Owners agree that no interest will accrue to them on any funds held in escrow by the Escrow Agent pursuant to this Agreement and that in addition to the escrow and inspection fee paid to the Escrow Agent, the Escrow Agent may receive ancillary benefits from the use of the funds held in escrow. 8. Severability The invalidity of any portion of this Agreement will not and shall not be deemed to affect the validity of any other provision. If any provision of this Agreement is held to be invalid, the parties agree that the remaining provisions shall be deemed to be in full force and effect as if they had been executed by both parties subsequent to the expungement of the invalid provision. 9. No Waiver The failure of either party to this Agreement to insist upon the performance of any of the terms and conditions of this Agreement, or the waiver of any breach of any of the terms and conditions of this Agreement, shall not be construed as subsequently waiving any such terms and conditions, but the same shall continue and remain in full force and effect as if no such forbearance or waiver had occurred. 10. Governing Law This Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of ____________. 11. Notices Any notice provided for or concerning this Agreement shall be in writing and shall be deemed sufficiently given when sent by certified or registered mail if sent to the respective address of each party as set forth at the beginning of this Agreement. 12. Mandatory Arbitration Any dispute under this Agreement shall be required to be resolved by binding arbitration of the parties hereto. If the parties cannot agree on an arbitrator, each party shall select one arbitrator and both arbitrators shall then select a third. The third arbitrator so selected shall arbitrate said dispute. The arbitration shall be governed by the rules of the American Arbitration Association then in force and effect. 13. Entire Agreement This Agreement shall constitute the entire agreement between the parties and any prior understanding or representation of any kind preceding the date of this Agreement shall not be binding upon either party except to the extent incorporated in this Agreement. 14. Modification of Agreement Any modification of this Agreement or additional obligation assumed by either party in connection with this Agreement shall be binding only if placed in writing and signed by each party or an authorized representative of each party. 15. Assignment of Rights The rights of each party under this Agreement are personal to that party and may not be assigned or transferred to any other person, firm, corporation, or other entity without the prior, express, and written consent of the other party. 16. In this contract, any reference to a party includes that party's heirs, executors, administrators, successors and assigns, singular includes plural and masculine includes feminine. WITNESS our signatures as of the day and date first above stated. ____________________________ ___________________________ (Name of Contractor) (Name of Owner) By:__________________________ By:_________________________ ____________________________ (Printed Name of Owner) (Printed name & Office in Corporation) _____________________________ ____________________________ (Signature of Officer) (Signature of Owner) ______________________________ _____________________________ (Name of Escrow Agent) (Name of Owner) By:____________________________ By:__________________________ _______________________________ (Printed Name of Owner (Printed name & Office in Corporation) _______________________________ _____________________________ (Signature of Officer) (Signature of Owner)