What are the pros and cons of wire transfers vs cashier's checks for closing funds?

1 Wire transfers

A wire transfer is an electronic transfer of funds from your bank account to the escrow account or title company. It's fast, secure, and convenient, as you don't have to worry about carrying or mailing a large check. However, wire transfers also have some drawbacks. They can be costly, as both your bank and the recipient may charge fees for the service. They can also be vulnerable to fraud, as hackers may try to intercept or redirect your funds by sending you fake emails or instructions. To avoid scams, you should verify the wire information with the escrow agent or title company over the phone or in person, and never rely on email alone.

2 Cashier's checks

A cashier's check is a check issued by your bank that guarantees the payment of a specific amount of money. It's safer than a personal check, as the funds are drawn from the bank's account, not yours. It's also cheaper than a wire transfer, as you only pay a one-time fee to the bank for issuing the check. However, cashier's checks also have some disadvantages. They can be inconvenient, as you have to go to the bank to get the check, and then deliver it to the escrow agent or title company in person or by mail. They can also be delayed, as the check may take time to clear or be lost or stolen in transit. To avoid problems, you should get the check a few days before closing, and keep a receipt and a copy of the check for your records.

3 Other options

Wire transfers and cashier's checks are the most common ways to pay for your closing funds, but they are not the only ones. Depending on your state and your lender, you may also be able to use other options, such as certified checks, personal checks, or money orders. However, these options may have more restrictions or limitations, such as lower amounts, longer processing times, or higher fees. You should always check with your escrow agent or title company about their preferred method of payment and their requirements before closing.

4 What to bring to closing

Before the final settlement, you'll need to bring several items and documents, such as your photo ID, loan documents, proof of insurance, closing disclosure, home inspection report, appraisal report, and contingency release forms. Additionally, you should bring any keys or other items from the seller. It's important to review all documents carefully and ask any questions you may have to your escrow agent, title company, or lender before signing them.

5 Tips for a smooth closing

To ensure a smooth and successful closing, you should confirm the date, time, and location of the closing with your escrow agent or title company at least three days before. Additionally, review your closing disclosure and contact your lender if you notice any errors or discrepancies. Arrange for the transfer of your closing funds and confirm the receipt one day before. On the day of closing, bring a cashier's check or certified check for any additional costs or fees that are not covered by your wire transfer. Have a pen and calculator ready and be prepared to sign a lot of papers. Finally, celebrate your new home ownership and enjoy your new property.

6 Here’s what else to consider

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