How to wire transfer your funds at real estate closing
Wire transfers are a very common aspect of a real estate transaction. The transfer takes less than one business day and is sent through an escrow account — a third party account that holds the funds until the contract terms are met. Wires are sent from the buyer to escrow, the buyer’s mortgage lender to escrow, and then escrow to the seller. Wire transfers are common within the real estate business for various reasons, including:
The use of electronic wire transfers is secure (although fraud and user error do occur sometimes)
Online transfers and phone transfers are both possible
Wire transfers are faster than most other payment methods
There are several steps involved in closing these wire transfer deals. They include:
- General Closing Process Steps in Illinois
- The sales contract is signed
- Attorney Review and Inspections
- Title search & examination
- Document preparation and/or request to produce
- At closing: documents are signed, funds are dispersed from the lender.
How long does a wire transfer take?
Individual wire transfers can usually be completed within one business day but can take up to two to four business days because funds will go through escrow.
What is the typical process?
- The mortgage loan is approved and the lender wires funds to escrow
- A few days before close, the buyer sends a wire to escrow consisting of the down payment, and closing costs
- At close the escrow agent deducts closing costs for buyer and seller, fees and any other costs the seller agreed to pay
- Then funds are wired to the seller after close
Wire Fraud in Real Estate
Wire transfers are generally a simple and safe method of sending funds, but oftentimes can be the target of fraud. Criminals target the buyers of pending real estate sales and pose as the title company, agents, escrow and lawyers, or anyone involved in the transaction.
Never wire money to someone via email or through online banking. It is important to confirm the instructions over the phone and follow the steps provided. If anything contradicts the information you’ve been told, call the individuals associated with the closing costs and confirm before you wire the money. ARK Attorneys will never ask for wire transfer information via email.
Wiring transfer funds via a title company
ARK Attorneys work hand in hand with our in-house title company, Atlas Title, and Escrow — making the closing process easier and more efficient for our clients. Our clients can use a cashier’s check to close if the property they are buying is under $50,000; anything above that amount must be paid via a wire transfer.
Contact us for more information. 312.753.3142