Sometimes buyers are confused when it comes to providing checks at various stages of the home buying process. The first check that usually is needed is one for the escrow deposit when the offer to buy a home is made. Sometimes this is called "good faith money". It is held by the title company, the real estate firm, or some other entity in a special escrow account. This check can be a personal check since there is usually time for the check to clear before the sale closes and everyone can be sure that the check is "good" well before the sale closes.
The second (and usually last check) that will be needed will be for your costs at the closing. These costs can include your down payment, financing fees, prorated taxes and HOA fees, prepaid insurance money, payment of surveyor's services, etc. Since this is being paid on the very day of closing, the title company or closing agent MUST be sure that the check is good. They can take no chances that the check will bounce for insufficient funds after the sale is closed and the property has been transferred. For this reason most closing agents and most purchase agreements will specify that the check brought to closing be a cashiers check, an official bank check, or an electronic transfer directly from the bank into the title company's account. If you show up with a personal check, it will not be accepted for the reason mentioned above. Make sure that the check is made out to the name of the closing agent, not the real estate agents or their companies. The sale of real estate is too important and the transfer agents must be sure that all is on the up and up and that no surprises will pop up in the future.
So as you go through the home buying process ask questions of your real estate agent and make sure that when you get to closing you have the proper type of check and that it is for the correct amount.
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