When purchasing a home, personal checks are not accepted at the closing table. “Good Funds” as our contracts call money due at closing, will need to be either a cashier’s check or wire transfer. A cashier’s check is simple to obtain. Usually you can purchase one at your bank. These work well when you have a down payment to bring.
BUT be aware! There are limitations as to how large a cashier’s check can be. Example, if you are a cash buyer and need to bring a sizeable amount to closing, the title company will probably require you not bring the whole amount in the form of a cashier’s check. I recently had a closing where this very thing happened. The title Company conducting closing would not allow the buyer to bring a large cashier’s check for his purchase. He had to wire money in advance or we couldn’t close.
Wire transfers are pretty simple. You go to your bank and give them the title company’s wiring instructions. Your bank will then send the wire for you. But, wire transfers do take some time to show up. All wire transfers have to go through the Federal Reserve Bank which is located on the East coast. So wires can take a few hours to route correctly. And if you send a wire in the later part of the day, keep in mind that it may not show up until the following business day. East Coast hours do apply and the cut-off time is 3pm East Coast time.
On the other hand, earnest money deposits (up-front monies) can usually be in the form of a personal check. Money stuff is always complicated. One of the many reasons you hire a Realtor, so you don’t have to figure all this stuff out for yourself! If you want to learn more, check out our finance videos for Buyers or simply give me a call!