You’ve finally made it to the end – only two more steps to go. Now comes the painful one; parting with your hard earned dollars. It’s time to pay the down payment and the closing costs.
A day or two before closing, your mortgage lender will email you an estimate of your down payment, closing costs and prepaids. In addition, your mortgage lender will ask you to transfer over a little extra money (usually around $500) just in case the closing cost figures are off at all. For example if you’re buying a $1 million dollar property and you’re putting 20% down, your mortgage lender will ask you to wire transfer approximately $210,500 ($200K for the down payment, $10K for the closing costs/prepaids and an extra $500). Generally you won’t get this figure until a day or two before closing and it HAS to be transferred by the morning before closing. Your mortgage lender will also help you get the wire transfer instructions from the Title company which gives you the account number to send the wire transfer. Plan to take a long lunch break from work as you have to go into your bank in order to conduct this type of wire transfer usually. Make sure you find out what time your bank stops accepting same day wire transfers as it’s not the same as their regular business hours. Therefore, they may be open until 8pm, but the cut off for same day wire transfers is 3pm. In that scenario, you’re going to need to finish the wire transfer prior to 3pm the day before closing. We can’t state loudly enough how important it is that the wire transfer be done the day before closing before the same day wire transfer cut off time. If you don’t transfer the funds the day before closing, closing has to be delayed because the Title company won't receive the funds in time. Another option is to ask the Title company if they will accept a cashier's check and bring a cashier's check with you to closing instead (Title companies will not accept a personal check).
Once you’ve sent over the wire transfer, email our team and your mortgage lender so we can check to make sure the Title company received the funds. IMPORTANT: do NOT follow wire transfer instructions unless they were sent to you by the escrow closer from the Title company. We cannot stress enough that all wire transfer and financial instructions will come via password protected or by encrypted email from the escrow closer and not from me. There are a lot of scammers out there who have been hacking into Realtor and lender emails lately and sending buyers fraudulent wire transfer instructions in an attempt to divert your $ into their accounts. Before you transfer your funds, call the escrow closer directly at the Title company to confirm the wire-transfer instructions. DO NOT rely on the phone number in the email as this number could be fraudulent as well if the email is fraudulent. Look up the phone number for the escrow closer through Google or by asking the lender on the phone and call that number instead. We cannot stress enough how careful you need to be when sending over your wire transfer to make sure it isn’t being directed to a fraudulent account.
Just a reminder, at closing you’ll get a refund check back made out to you for the overage closing cost funds you transferred.
