Welcome to San Diego Blog | October 9, 2018
Wiring Money When Buying a Home
Wiring money… where does it go, how is it done and what are the benefits? These are typical thoughts running through the mind of someone who is getting ready to wire large amounts of money for the first time. Here is your quick guide on wiring money:
What Is A Wire Transfer?
Wiring money is typically referred to as a “bank wire transfer”. It is a method of payment that happens through an electronic funds transfer from one bank to another. There is no physical cash movement in this option, only the balance in each account is modified. Since the identification of both the parties is confirmed prior to transfer, it is considered a safe method. The popularity of wire transfer can also be attributed to their speed and convenience. This is the most common method used when a buyer closes on a property they are purchasing.
How Do I Complete A Bank Wire Transfer?
Step 1: Contact the escrow company or appropriate recipient via phone and confirm that the wire instructions (account number, receiving name, etc.) are accurate. This is the single most important step. Don’t rely on emails or text. Pick up the phone and make that call. Doing so serves as an additional safeguard to ensure that your funds are truly being sent to the intended party and will give you peace of mind when sending such large sums of money.
Step 2: Assemble the information you need. This includes the recipient’s name, bank name, the bank’s American Banking Association (ABA) code and the recipient’s bank account number.
Step 3: Approach your bank and place an order to transfer a specific amount to your recipient.
Step 4: Complete the wire transfer form. this can sometimes be found online, but if not, you can get one from your bank’s branch. there is a spot on the form for additional optional information. I suggest that you fill it out, identifying the address of the subject property.
Step 5: Verify the required additional information. A state issued ID or verification information will be required to complete the transaction.
Step 6: Pay any required transfer fees, which will vary by bank or credit union. When your transfer is complete you will receive a receipt either at the bank, by fax or by email.
What Are The Benefits Of Wiring Money
- It’s a great way to get money from A to B with minimal delays.
- Funds are typically available within hours of the closing (cashier, certified and personal checks require a minimal 10 days hold to clear funds).
- There are virtually no geographic limitations.
- Because bank wire transfers are used for important and large transactions, many systems are in place to increase security and reduce fraud.
- It’s often the cheapest method for transferring funds between bank accounts.
What Are the Disadvantages Of Wiring Money?
- The buyer and the seller may accrue a variable fee for the transaction.
What Should I Be Aware Of When Wiring Money?
- Online banking fraud is on the rise.
- If you receive an email containing wire transfer instructions, call your escrow office immediately to verify the information prior to sending funds.
- Most Real Estate Agents will never send you wire instructions and instruct the escrow officer to send to the client directly.
- Fraudulent wire emails can look almost mirror your agent’s or escrow officer’s email address, logos, signatures and more.
- Be diligent and when in doubt, make that call and confirm the wire instructions.
- Never go off instructions that are given by escrow officer.