Good Funds Law – IMPORTANT FOR ALL BUYERS!!!
- Buyer’s need to make plans to wire deposits for closing rather than bring a cashiers check
- Funds under $1000 will be accepted via a check, but anything above must be wired.
- Buyer’s must prepare to wire funds weeks in advance to avoid any issues.
Closings are changing on April 6th and it might add another step for you as Buyers. But don’t worry, we’re here to keep you informed and prepared!
Here’s what you need to know:
On April 6, 2017, the Ohio Good Funds Law goes into effect. Settlement agents, which are the title people that close a real estate transaction, can only disperse funds once they’ve been deposited in their accounts. What does this mean: the funds from the closing can only be dispersed and finalized once the funds from the Buyer are present in the title companies bank accounts (not just brought to closing as a check). This means you can no longer bring a Cashier’s Check the day of closing as in the past. The funds must be wired prior to closing so that they can verify the funds are “good” and available.
In an effort to ease the process for you as a Buyer, we suggest preparing for the wire as early as two weeks prior to closing. Make sure funds are ready to send from one accounts, or as few as possible ideally, while also discussing the wiring process with your bank. Typically, you’ll have to do this in person at the bank branch so if you’re from outside of Cincinnati, make sure you make preparations prior to leaving your home.
If you are the Seller of a property, you can still choose to have the title company cut you a check for the proceeds at closing or wire the funds directly after. Keep in mind that title companies will charge a fee for outgoing wires. Also, as any wire, double check the wiring instructions (especially if emailed) to prevent any fraud or hacking.
Below is a list of acceptable forms of transferring funds to the title companies:
- Checks up to $1,000 (Cashier, Personal, Money Order, Business or Official)
- ACH – Automated Clearing House Checks or Transfer within the United States.
- Checks from Real Estate Broker’s Escrow/Trust Accounts.
Tips for wires:
- Double check any wiring instructions sent via email with a phone call to the title company.
- If you have questions or any doubt, ask your real estate agent or title company.
- Keep in mind that there are wiring fees charged by the banks. To keep these minimal try to wire funds from one account if possible to avoid multiple fees or any confusion.