Do I need to wire the closing costs/down payment before the closing?

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Do I need to wire the closing costs/down payment before the closing?

I just received an email from my real estate agent last night that she forwarded. It states: “X Title has been contracted by Y Bank, to handle the closing of this transaction. I am attaching a Buyer Questionnaire and Authorization form for you to forward to your buyers. Please CC me on the email so I will have their contact information. I have emailed the Seller’s agent as well this evening.Please have your buyers’ send me a copy of their new insurance binder and paid receipt for the premium when they send it to the Lender so I will have a copy for my file. Lastly, I am attaching wiring instructions as I have buyers wire funds instead of certified checks. Checks still take 2 days to clear and I need good funds the day of the closing in order to record. I will explain the process again with buyers when we have an approved HUD. Just as simple as getting a check.” I have never heard of this company before now, and find it very strange that they want to have the money wired instead of a cashier’s check. I’ve purchased a home before and never wired any funds. I’m afraid with a wire there is no paper trail to fall back on if needed. Is this something you have heard of? Is this a legal request? Does this come across as fishy?

Asked on July 5, 2012 under Real Estate Law, New Hampshire

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

If you are uncomfortable with the requests for closing escrow with respect to the transaction that you are involved in, you should heed your instincts.

Custom and practice in the real estate industry is that a cashier's check (as opposed to a personal check) clear immediately so I fail to see any reason why a wire transfer of your funds is necessary. You can simply overnight a cashier's check with a tracking code to the escrow company and the officer's receipt of it should occur the following day.

I suggest that you first speak with the escrow officer with respect to your matter and your intent to send a cashier's check instead of a wire transfer were the cashier's check will be overnighted to escrow concerning the real estate transaction that you are writing about.

If you were my client, I would insist upon the overnight transport of the cashier's check by you directly to escrow with a tracking number.


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