When Should You Wire Funds for Closing?

When purchasing a home, transferring funds for your down payment and closing costs is a significant step. Wiring funds is a common and efficient method for these large financial transactions, ensuring the money reaches the correct recipient promptly. Understanding the proper timing and secure procedures for this transfer is important to avoid delays and protect against potential fraud.

Understanding Your Closing Disclosure and Wire Instructions

The Closing Disclosure (CD) is a form that provides final details about your mortgage loan. This document outlines the financial specifics of your real estate transaction, including the exact amount of funds you need to bring to closing. You typically receive the CD at least three business days before your scheduled closing date, allowing time for thorough review.

The definitive wire instructions for your closing funds are typically provided by the title company or escrow agent handling your transaction. These instructions specify where to send your money. They include the recipient bank’s full name, its routing number, the specific account number, and the beneficiary’s name, usually the title company or escrow agent.

The exact amount to be wired will be specified on your Closing Disclosure. This amount represents the total funds due from you, encompassing your down payment, closing costs, and any other agreed-upon adjustments. Carefully compare this amount to the wire instructions to ensure consistency.

Verifying Wiring Instructions

Verifying the authenticity of wiring instructions is important to safeguard your funds against fraud. Cybercriminals often attempt to intercept email communications and send fraudulent wire instructions. Instructions received via email should never be trusted without independent verification, even if they appear to come from a legitimate source.

You must independently verify all wiring instructions by calling the title company or escrow agent directly. Use a phone number you have independently confirmed, such as one from their official website, a previous physical letter, or your real estate agent. Do not use a phone number provided within an email containing the wire instructions.

During this verification call, verbally confirm every detail of the wire instructions: the recipient’s name, the bank’s full name, the routing number, the account number, and the precise amount of funds to be transferred. Be wary of any last-minute changes to instructions, especially if communicated solely via email or text message, as this is a common red flag for fraud.

Initiating the Wire Transfer

After verifying the wiring instructions, initiate the wire transfer through your financial institution. Most banks offer several methods for sending a wire transfer, including visiting a local branch in person, initiating the transfer over the phone, or utilizing secure online banking portals. Each method requires you to provide the verified recipient bank details.

Initiate the wire transfer one to three business days before your scheduled closing date. This timeframe allows sufficient time for funds to clear and become available in the recipient’s account, preventing potential delays. Wire transfers are typically processed within the same business day if initiated early.

Banks have daily cut-off times for processing wire transfers for same-day delivery, which commonly range from 2:00 PM to 4:00 PM local time. Wires initiated after these cut-off times will generally be processed on the next business day. You must account for weekends and federal holidays, as these do not count as business days for wire processing.

Confirming Fund Receipt

Once you have initiated the wire transfer, it is important to confirm that the funds have been received by the title company or escrow agent. You should contact them directly after sending the wire. This proactive step helps ensure the money has arrived safely and is correctly applied to your transaction.

The recipient party, typically the title company or escrow agent, should be able to confirm receipt of the funds once they are reflected in their account. This confirmation provides peace of mind and verifies that the financial aspect of your closing is proceeding as planned.