How Do I Send Cash Due at Closing to Expedient?
As your residential real estate transaction enters the final stages leading up to the closing, you may wonder what the next steps in the process are for you as the consumer. Expedient Title has many rules and regulations to follow behind the scenes, but there is one that the consumer must be aware of to ensure a legal and safe transfer of funds at the closing table. In this article we will discuss the Ohio Revised Code and the “Good Funds Statute”, and how this affects all parties involved including buyers, sellers, lenders, and the title company or escrow agent.
The Ohio Revised Code, or “ORC”, was formed to replace the Ohio General Code in 1953 with the purpose of clearly defining and listing the general laws of Ohio. The laws in this code are passed by the Ohio General Assembly; this assembly is comprised of the Ohio House of Representatives and the Ohio Senate. The ORC consists of 31 general titles, with these titles being divided into chapters that include the individual topics of law.
While it is important to be educated on and follow all topics of law in the Ohio Revised Code, Expedient Title’s focus within the Code is with the Good Funds Statute, also known as Section 1349.21. The Good Funds Statute, originally placed into effect in 1996 and revised in April of 2017, requires we strictly abide by certain rules regarding transactions involving the purchase or refinance of residential real estate. The Good Funds Statute clearly defines how and what type of funds can be accepted by the title company or escrow agent at the time of closing, with the purpose of protection and security against fraudulent activity. This statute may seem like it adds extra steps to the pre-closing process, but it is crucial to remember that it was written to protect the consumer from becoming a victim of fraud.
It is important to be aware that this Code, no matter your role in the transaction, applies to all buyers, sellers, and lenders alike. Anyone who is required to provide funds that exceed the amount of $10,000 at the time of closing must wire the funds to the title agency or escrow agent. This means that cash, personal or cashier’s checks, and money orders will not be accepted at the time of closing. If the funds for closing are less than $10,000, the title company or escrow agent can accept a certified check, and if the funds required to close are less than $1,000, the title company or escrow agent will be allowed to accept a personal check. It is also important to note that cash and credit/debit cards are not acceptable forms of payment at the closing table.
When using a personal check (closing funds total less than $1,000) the borrower simply writes a check as one would for any other transaction. If using a certified check (closing funds total less than $10,000) the borrower must simply go to the bank and work with a representative to obtain the certified check. For all wire transactions (funds exceed a total of $10,000), Expedient Title has a strict and detailed process to protect all parties from wire fraud. The steps in this process are as follows:
1. The borrower calls Expedient Title to establish a password that is unique to their transaction so that wire instructions can be emailed safely.
2. The borrower opens the secure email with the established password and will then call the title company to verify the information contained in the email. At the beginning of this call, the borrower will be asked specific questions that only they will be able to answer so their identity can be verified with the title company before confirming any of the data within the email.
3. The borrower will then go to the bank, and a bank representative will call the title company to verify the wire instructions verbally. (We recommend the bank representative look up Expedient Title’s contact information on their own, rather than using a phone number in an email signature, as these can be fraudulently modified by someone intercepting an email. Hacking is not something Expedient Title typically experiences, but it can happen, and it is important to keep things as secure as possible for all parties involved.)
4. After the bank wires the funds, we ask that the borrower obtain a receipt from the bank to bring to the closing for proof of the wire being sent.
For the consumer’s safety, Expedient Title has additional security measures in place behind the scenes regarding handling of all escrow funds, but they will not be disclosed in this article.
These steps may seem a bit intimidating as this is not something one typically does in their day-to-day life, but they are in place to protect the consumer, bank, and title company from becoming victims of wire fraud. Expedient Title originally established this process while working out of Ohio but has since begun these steps for Florida residential real estate transactions as well. Should you have any questions about the Good Funds Statute, or any of the other information listed in this article, please feel free to reach out to Expedient Title at any time. We are always here to help!