Wire Transfer Vs. Cashier’s Check

Real Estate Agents
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Wire Transfer Vs. Cashier’s Check

What is the best way to fund a real estate transaction?

The two primary ways to send money to your title company for your real estate closing are Wire Transfers and Cashier Checks. But which one should you use to fund your transaction?

Both wire transfers and cashier checks have their advantages and disadvantages. Let’s try to examine both options and make a better educated decision of which way to use to fund a real estate transaction, and when.

What is the Difference between a Wire Transfer and a Cashier’s Check?

Cashier's Check

A Cashier’s Check is a certified paper check that is issued and signed by a bank teller. To obtain a cashier’s check you will have to physically walk into a local branch of your bank with a personal check, your bank will then withdraw the funds from your account and will issue a certified check signed by a bank representative. A Cashier’s Check “guarantees” the availability of funds at the time the check is deposited by your title company or escrow agent.

Advantages and Disadvantages or using a cashier’s check

The primary benefit of using a cashier’s check is that it might be cheaper in fees than sending a wire transfer (depending on your bank’s policies and your banking relationship). But since it is still a physical paper check, you will have to go into a branch to obtain one.  Once deposited, cashier’s checks are also subject to a “waiting period” until the issuing bank “clears” the funds into your title company’s bank account. Lastly, you will have to personally deliver, or mail the paper cashier’s check to your title company, you might miss important funding deadlines in your contract, or even worse, a check might completely go missing in the mail.

Wire Transfer

A Wire Transfer is an electronic transfer of funds between two accounts which can be initiated by either a local branch of your bank or financial institution or, if your bank offers this option, by submitting an electronic request via your bank’s or financial institution’s website or portal. Another way to initiate a wire is through your bank’s local branch, or the centralized “wire room” which usually requires you to email or fax them a “wire request form”

Advantages and Disadvantages or using a wire transfer

If your financial institution provides you the option to initiate wire transfers online, then it should be the safest and most convenient way to send funds to your title company for your real estate closing. You can most likely initiate a wire transfer from your bank’s or financial institution website or portal from the convenience of your home computer or potentially even from your mobile! You do not have to physically travel to your bank’s local branch, nor deliver any checks or mail them to your title company.

One drawback to wire transfers is the potential of cyber-fraud. To prevent cyber-fraud, if your title company or escrow agent provided you with their wire instructions through an electronic channel, such as an email or a secured portal,  it is crucial that you call your title company or escrow agent and verbally confirm and verify the wire instructions you electronically received. This additional verbal verification provides you an additional layer of security and allows you to ensure you are sending your funds to the right place.

What is the Difference between a Wire Transfer and a Cashier’s Check?

We, at Florida Real Estate Title & Closings, Inc always recommend using wire transfers to fund your real estate closing. Wires provides better information privacy and helps you meet the funding deadlines in your purchase contract. If you wish to use a cashier’s check, please contact us as soon as possible so we coordinate a timely delivery of funds. We only accept cashier’s checks to cover Earnest Money Deposits.

If you have any additional questions about ways to fund your real estate transaction or about any of the differences between wire transfers and cashier’s checks, feel free to contact us directly or leave us a comment on this post below.

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