Ohio Good Funds Law Impact on Buyers and Sellers

Ohio License PlateOn Thursday April 6th the Ohio’s “Good Funds Law” goes into effect impacting both buyers and sellers. 

What is the “Ohio Good Funds Law”? 

The law requiring any funds for more than a $1,000. to be electronically wired to the closing agent prior to closing.  No more certified and/or cashiers checks.  Personal checks, certified checks or money orders are acceptable for expenses up to $1,000. which means buyers need to bring their checkbook (or other certified payments) to the closing to cover any last minute costs.  


On April 6th all transactions closing on or after that effective date, title agents will be required to follow much stricter controls over the handling of closing funds. 

Impact on Buyers:

  • No more driving to the bank the morning of the closing to obtain a certified check to cover the difference between mortgage and purchase price.  (unless the dollar amount is $1,000. or less.)
  • Lender must electronically wire funds to closing agent in time for the deposit to show up in the title company’s account. And title companies are tightening on transmitting wire instructions to avoid hacking and fraud.  Some title/closing companies may require telephone contact to confirm details.  So buyers may have more than one party contacting them about the closing.
  • Not all financial institutions wire funds at the same pace- so buyers or lenders who approve wire transfers late in the afternoon for a closing the next day- may not close because funds didn’t transfer on time.
  • Most likely your real estate agent won’t be able to communicate wiring instructions to you since that information could be considered nonpublic and personal information.
  • Immediate occupancy may be a problem if the seller needs fund to close on their purchase and are delayed because wiring requirement.
  • In short, everybody needs to be on the same page when it comes to “funding” the closing.

Impact on Sellers:

  • The biggest impact on sellers who need the money from the sale to immediate close on their new property (commonly called back-to-back closings) may need to delay the 2nd closing until the funds are wired to the next title/closing company.  One way to avoid the delay is for both the buyer and seller to use the same closing company- since the funds are sitting their accounts and ready for use.

Like any new rule or change we’re going to have a rough month or so until everybody figures out the best way to handle the new rules.

The biggest hurdle will probably be the occupancy issue- buyers want to move in immediately but most sellers need the money from sale to buy the next place and don’t want to be homeless for 2-3 days.  And for buyers who think the loan process is obnoxious- get ready to deal with no texts or emails when it comes to wiring instructions.   

Be patient the impact of the Ohio Goods Fund Law has on real estate closings will get easier within a few months.