Now that we’re getting closer to your closing date, it’s time to get your down payment ready! Remember that in addition to the down payment, you need approximately 3% of the purchase price on top of the down payment available in cash for the closing-costs. Click here to read more about closing costs in Northwest Montana.
If any of these funds are going to be gifted to you from a family member, you need to let your mortgage lender know right away so he or she can get approval from the underwriter for the funds.
It’s best if the down payment and closing cost funds are transferred into one account. This account must be disclosed to your mortgage lender and you must let him or her know this is the account you’re going to be using for the down payment as the funds have to be tracked.
A few days before your closing date, the title company will email you an estimate of the amount of money needed to close as well as the wire transfer instructions. Unfortunately, the total amount needed is usually not available farther in advance as the title company needs to receive final figures from your lender (if utilizing a mortgage). Amounts under $50,000 can typically be paid for with a cashier’s check, however, amounts over $50,000 must be wire transferred. He or she will also ask you to transfer extra money, usually $1,000 to $2,000 on top of the estimate, just in case there are any surprises or mistakes found at closing in regards to the numbers, which happens frequently. You’ll wire transfer these funds in one lump payment at least the DAY BEFORE CLOSING if not two days before.
While it would be nice to wire transfer the funds several days in advance, often the title company doesn’t have the exact figures until a few days before. Therefore, call your bank now and find out what you need to do to make a wire transfer. Most of the time you have to go into the bank personally to initiate the wire transfer. Also, find out what their cut off time is for wire transfers. Usually it’s around 4pm. That means you’ll have to do the wire transfer by that time the day before closing in order for it to go into the title company’s account on time. Once you’ve done the wire transfer, email myself and the mortgage lender so we can make sure the title company received the funds.
At closing, any overage/extra money you paid will be refunded back to you at the very end of the closing via a check.
IMPORTANT: Wire Fraud Warning. Wire fraud is a serious risk, with scammers attempting to divert closing funds to their own accounts. To protect yourself, only follow wire
transfer instructions sent directly from the title company. Never trust wire instructions from anyone else, even if the email looks legitimate. Hackers can create convincing fake messages. To verify the instructions, call the title company directly using a trusted phone number—not one from the email—to confirm before sending any funds.
