Most people make payments in cash and wire transfers in real estate, but the method has setbacks. It makes checks ideal for real estate purchases. Checks are issued by the financial institution (the credit union or bank) on behalf of the customer to fund a large purchase. The customer pays the financial institution the check’s total face value in advance, and in return, the bank deposits the amount, awaiting the issuing of the check to the designated payee. Below are five reasons to consider using a check when purchasing real estate.
1. Secure Payments
Unlike most payment means, checks provide security for the seller and buyer, ensuring the funds are available for smooth real estate transactions. These checks have extra safety features such as watermarks and bank signatures, considerably reducing the risk of fraud and funds theft as they are hard to counterfeit.
Since the bank issues them and the customer’s account doesn’t make the payment, they guarantee the safety of the transaction by ensuring that no one else can cash out apart from the designated payee. Moreover, checks prevent the need to carry vast amounts of cash when purchasing a property, which undeniably can be pretty unsafe.
2. Record Keeping
When you pen a check for your real estate transaction, you create a physical paper trail, making it easy to track the whole transaction. Additionally, they serve as proof of payment to help you solve issues and misunderstandings that may arise during the process if you want to clear some problems in the future. Furthermore, you can use the record when filing for returns, making the process seamless.
3. Faster Processing Time
Time is of the essence in real estate transactions. Ordinarily, issuing a check takes about one business day, and the whole process is equally fast. While using a check, the seller and the buyer ensure that the transaction takes place efficiently and quickly, thus closing the deal using minimum time as possible.
4. No Hidden Fees
Unlike other payments that charge extra hidden fees that may shoot way beyond your budget, using a check avoids such scenarios. By utilizing a check, the seller and buyer prevent additional costs and ensure that the transaction stays within the buyer’s budget. Using a check to complete the real estate process provides the most stability during the financial transaction.
5. Convenient Payment
Checks are not just safe but also convenient for the property buyer. The fact that they eliminate the need to carry large amounts of cash means one can conveniently make payments. Also, one doesn’t have to wait in line for days to process these checks, as regular personal checks do.
While checks come with these advantages, it’s important to note that real estate transactions involve large sums of money, and the parties involved(the buyer and seller) may have precise wants for the transaction methods. It is prudent to consult with real estate professionals and legal experts beforehand to ensure that the chosen payment method aligns with all relevant regulations of all the parties involved. It ensures customer satisfaction during the whole process.