The last thing a homebuyer or seller wants to deal with is not being able to close the deal due to fraudulent activity. Unfortunately, the mismanagement of closing costs and down payment monies can stop a sale in its tracks. The state of Ohio has the Good Funds Law on the books to help combat shady residential real estate transactions. Here is a helpful guide on the mandate, what it covers, and how it affects buyers and sellers.

Purpose of the Good Funds Law 

The Good Funds Law helps prevent wire fraud and safeguards closing costs and down payment monies kept in an escrow account until the title company disburses the funds. In the past, fraudulent wiring instructions would steer funds to accounts not intended for closing costs and down payment monies. The law provides extra protections to stop criminal activity by verifying wiring instructions through written documentation. The account and contact information is then double-checked before the funds are wired to or from an escrow account. 

What the Law Covers

closing costsThe law, enacted in April 2017, requires funds of $10,000 or more to be electronically transferred to the title company before closing on a real estate property purchase. Closing funds ranging from $1,000 to $10,000 can still be accepted in the form of cash, certified checks, money orders, and official bank checks. These funds must be drawn from an existing account at a federally insured bank, credit union, savings bank, or savings and loan association. The title agent must receive closing costs and down payment monies before disbursement.

How the Law Affects Buyers & Sellers

In real estate transactions, buyers aren’t permitted to bring a certified check for closing costs and down payment monies if the amount is more than $10,000. If sellers are waiting on funds from a first closing transaction to settle a second closing, they may have to put the latter closing on hold until the funds are electronically wired to the title company.


For more than 30 years, All Points Title & Closing, Inc. in Hamilton, OH, has provided professional service involving residential real estate transactions and closing costs. The team of licensed title agents has extensive experience and knowledge to get your deal to a successful, transparent, and legal closing. To learn more about their expertise, call (513) 863-7600 or visit the website.