Downside to sending wire before seller sends closing?

[Adg0428]

What do I lose if I send the wire before the seller sends the closing docs? We received docs on Thursday and I returned them. We leave for Disney tomorrow and I wouldn’t be sending money while there, so I’m considering sending today.

 

[Jimmy Geppetto]

You risk having that money locked up for however long it takes the Seller to submit docs. There have been some horror stories (you can read about them on this site) where the Seller has gone AWOL or there was a mixup with the points in the original listing (ie. Seller used some points after listing). I don't think you are at risk of losing any money, it just could get tied up in the event things don't go smoothly. You are eligible to request the contract be terminated once the closing date passes and the Title company will refund your money.

It comes down to how comfortable you are with the money being held in escrow for a period of time while waiting on an action by Seller.

 

[RoseGold]

We leave for Disney tomorrow and I wouldn’t be sending money while there, so I’m considering sending today.

I set up standing instructions with my brokerage online, and then finished it on the phone. You might be able to set up most of it so it's ready to go when they do their part and just takes a phone call.

 

[Sandisw]

If something happens and the sale doesn’t happen then you have to wait to get it all back vs. just the deposit.

 

[Lorana]

I am now 13 days after closing docs were received and returned for a PVB contract I am purchasing, and the seller still hasn't returned their docs (and no update yet on when they will be. Last update said they would last week). I once had one seller on a resale contract take over a month to return docs... and that was when I learned never to send money over before the title company received the seller documents. I could have earned interest on that money for that money, instead of it sitting in limbo waiting for the seller. Personally, I'd rather wait for the seller to return docs, but it's up to you as to your comfort in either situation.

 

[Adg0428]

Thanks everyone! I decided to go ahead and send it over and hope for a good seller

 

[macman123]

They are sat on your money! I don't do it until the closing docs have been returned by the seller.......

 

[Paul Stupin]

I am now 13 days after closing docs were received and returned for a PVB contract I am purchasing, and the seller still hasn't returned their docs (and no update yet on when they will be. Last update said they would last week). I once had one seller on a resale contract take over a month to return docs... and that was when I learned never to send money over before the title company received the seller documents. I could have earned interest on that money for that money, instead of it sitting in limbo waiting for the seller. Personally, I'd rather wait for the seller to return docs, but it's up to you as to your comfort in either situation.

My guess is that the interest you could have earned was probably a dollar or two tops.

 

[Adg0428]

My guess is that the interest you could have earned was probably a dollar or two tops.

Yeah it’s not much. I’m not worried about that

 

[Lorana]

My guess is that the interest you could have earned was probably a dollar or two tops.

I have an account that earns 3.3% annual interest. For a $10,000 purchase, that’s $27.50 for a month. Still a small amount, but it’s still money. Likewise, I could have left it in stocks and perhaps the earnings would be more. Regardless, I’d rather have my money earn something for me, even if it’s only a small amount, than tied up in escrow waiting for a seller to return closing docs. Especially on my current contract, as when I asked the concierge folks if they knew the status of the seller, their response was just to tell me they have until 12/13 to close (!!!) - not the kind of reassurance I want. And in that case, I’d be looking at nearly two months, or $53. YMMV.

 

[DKZB]

I have an account that earns 3.3% annual interest. For a $10,000 purchase, that’s $27.50 for a month. Still a small amount, but it’s still money. Likewise, I could have left it in stocks and perhaps the earnings would be more. Regardless, I’d rather have my money earn something for me, even if it’s only a small amount, than tied up in escrow waiting for a seller to return closing docs. Especially on my current contract, as when I asked the concierge folks if they knew the status of the seller, their response was just to tell me they have until 12/13 to close (!!!) - not the kind of reassurance I want. And in that case, I’d be looking at nearly two months, or $53. YMMV.

Wait, 3.3% on an FDIC insured savings account? What's the catch? I know this is a Disney forum but please tell me where you are getting that kind of rate in this low interest rate environment!

 

[Adg0428]

Wait, 3.3% on an FDIC insured savings account? What's the catch? I know this is a Disney forum but please tell me where you are getting that kind of rate in this low interest rate environment!

Would love to know as well

 

[DisneyOutsider]

I see nothing but downside/risk for the buyer in this scenario with zero upside.

 

[Lorana]

Wait, 3.3% on an FDIC insured savings account? What's the catch? I know this is a Disney forum but please tell me where you are getting that kind of rate in this low interest rate environment!

Evansville Teacher's Federal Credit Union - their Vertical Checking Account earns 3.3% interest on up to $20,000. You do need a direct deposit or an incoming ACH deposit once a month, and 15 debit card transactions per month (which I do with small Amazon gift card reloads) to get that rate and by transferring in every month the amount needed for those debit transactions.
https://etfcu.org/accounts/checking/
There's also Lake Michigan Credit Union - their Max Checking earns 3% interest on up to $15,000. You also need a direct deposit or incoming ACH deposit once a month, and 10 debit card transactions.
https://www.lmcu.org/personal/banking/checking-accounts/max-checking/
I have both, which gives me 3-3.3% return on up to $35,000. Both are FDIC-insured.

 

[RoseGold]

I see nothing but downside/risk for the buyer in this scenario with zero upside.

I guess there is slight upside that you could close slightly earlier, but I wired same day after sellers returned paperwork, and all of my resales closed the same day or the next morning.

 

[Adg0428]

I guess there is slight upside that you could close slightly earlier, but I wired same day after sellers returned paperwork, and all of my resales closed the same day or the next morning.

yes, my hope is that they return the documents this week and we can close since I wired earlier even though I’m on vacation

 

[Mai Ku Tiki]

I am now 13 days after closing docs were received and returned for a PVB contract I am purchasing, and the seller still hasn't returned their docs (and no update yet on when they will be. Last update said they would last week). I once had one seller on a resale contract take over a month to return docs... and that was when I learned never to send money over before the title company received the seller documents. I could have earned interest on that money for that money, instead of it sitting in limbo waiting for the seller. Personally, I'd rather wait for the seller to return docs, but it's up to you as to your comfort in either situation.

I'm in waiting status...If I do resale again, is there a way to add a date definite for seller to return docs? It would prevent seller from delaying needlessly. You would think collecting their $ from the sale would be incentive enough, but I guess not.

 

[Sandisw]

I'm in waiting status...If I do resale again, is there a way to add a date definite for seller to return docs? It would prevent seller from delaying needlessly. You would think collecting their $ from the sale would be incentive enough, but I guess not.

The closing date on the document is the legal deadline. Unfortunately things happen that can delay people.

Once that date passes, then the buyer can cancel the sale and get the deposit back.

But that is about it and I doubt you would get any broker to insert a clause in the contract that ties a seller to X days. They do ask for it to happen in 2 weeks but given the need for a notary, it’s not always easy.

 

[Mai Ku Tiki]

The closing date on the document is the legal deadline. Unfortunately things happen that can delay people.

Once that date passes, then the buyer can cancel the sale and get the deposit back.

But that is about it and I doubt you would get any broker to insert a clause in the contract that ties a seller to X days. They do ask for it to happen in 2 weeks but given the need for a notary, it’s not always easy.

Then could the closing date on the document be revised? Mine is 30 days. Considering the seller signs off on that document & knows, having accepted the offer, that they will need to arrange time/place for notary, 2 weeks is reasonable. Of course, there would be exceptions is rare cases. Buyers know WE need to be ready to proceed when our offer is accepted. Seems fair.

 

[Lorana]

I'm in waiting status...If I do resale again, is there a way to add a date definite for seller to return docs? It would prevent seller from delaying needlessly. You would think collecting their $ from the sale would be incentive enough, but I guess not.

I think the only date is the closing date. But brokers started putting that date 90 days out last year due to delays on the Disney side of things. I think trying to negotiate an early closing date is the best bet.