3 Things That Will Ruin Your Scheduled Home Closing

 

3 Things That Will Ruin Your Scheduled Home Closing

Closing on a home is an exciting milestone, but it can quickly become a nightmare if certain pitfalls are not avoided. To ensure a smooth and timely closing, you should be aware of these three critical issues that can derail the process: depositing closing funds at the last minute, missing a bank wire deadline, and accepting fraudulent instructions.

1. Depositing Closing Funds Last Minute

One of the most significant mistakes you can make is waiting until the last minute to deposit or transfer your closing funds. Closing funds typically include the down payment and other associated costs, and these funds need to be cleared and verified by the bank before the closing can proceed. Oftentimes, people will leave funds in an investment account or 401K, and not do the appropriate homework on when and how those funds can be transferred and released.

Why It Matters: Banks often have specific hold times for large deposits, especially those made via personal checks. If you wait until the day before or even the day of closing to deposit these funds, there’s a high likelihood that the bank will not clear them in time. This delay can push back your closing date, causing inconvenience and potentially additional costs for both you and the seller. The seller is not contractually obligated to extend your closing date, so this misstep can be monumental. 

What to Do: To avoid this issue, make sure to deposit your closing funds well in advance. Opt for a wire transfer or a certified check, as these methods typically clear faster than personal checks. Confirm with your bank the exact hold times for large deposits to ensure you have ample time for the funds to be available by the scheduled closing date.

2. Missing a Bank Wire Deadline

Missing a bank wire deadline is another critical error that can disrupt your closing. Bank wire transfers are a common way to transfer large sums of money quickly and securely. However, banks have strict cut-off times for processing these transfers, and missing these deadlines can delay your funds reaching the closing agent.

Why It Matters: Wire transfers are typically processed in batches during specific times of the day. If you miss the cut-off time, your transfer will not be processed until the next batch, which could be the next business day. This delay can be particularly problematic if your closing is scheduled for late in the day or if it falls on a Friday, as the funds may not arrive until the following Monday. It’s also important to include holidays in your calculation so you don’t miss a deadline.

What to Do: To avoid missing a bank wire deadline, plan ahead and initiate your wire transfer early in the day. Contact your bank to confirm their cut-off times and ensure that you have all the necessary information, such as the recipient’s account details and routing numbers, to complete the transfer without any hitches.

3. Accepting Fraudulent Instructions

In today’s digital age, cyber fraud is a huge concern, and real estate transactions are a prime target. Accepting fraudulent instructions, such as fake emails directing you to wire funds to a fraudulent account, can lead to significant financial loss and derail your closing entirely.

Why It Matters: Fraudsters often pose as real estate agents, attorneys, or other trusted parties to trick you into wiring funds to their accounts. Once the money is transferred, it is challenging, if not impossible, to recover. This type of fraud can not only delay your closing but also result in the loss of your closing funds and likely the house you’re purchasing.

What to Do: To protect yourself from fraud, always verify wire instructions with a trusted source before transferring any funds. Do not rely solely on email instructions; instead, call your real estate agent or closing officer directly using a known, trusted phone number to confirm the details. Be wary of any last-minute changes to wire instructions, as these are often a red flag for fraudulent activity.

Whether you’re buying a home in Tacoma, Gig Harbor or Puyallup, it’s important to know how to protect yourself as your closing date approaches. Your mortgage lender and escrow officer should be regularly communicating with you about dates and times, but I always ensure my clients are getting ahead of the process, to avoid these three big mistakes. 

As your Tacoma and Gig Harbor & Puyallup Realtor, if you have more questions, please contact me at (206) 643-8845 or on my website at https://erikmolzen.bhhsnw.com 

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