Whether you are purchasing property from a seller or selling property to a buyer. What are the ways you guys accept payments? I'm somewhat skeptical on receiving checks from a stranger. I nearly got scammed with a fake check on Craigslist 3 yrs ago. I'm assuming someone found a payment system that helps mitigate the chances of being scammed or perceived as one to the seller.
While generally considered unsafe for the seller to give you their account and routing numbers for an ACH deposit when you are paying them, it's less risky to give your ACH numbers to them for them when they are paying you.
Try to avoid taking credit card payments that can be challenged and reversed. You certainly can use them, but there's some exposure to complications. I only use them for deposits.
For one-off payments cashier's checks and Bill Pay service from my bank are my general go to methods, unless the other person is savvy enough to use Zelle, PayPal, Google Pay or other online payment systems.
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Here are some approaches to consider to avoid risk on your end:
When purchasing:
The risk you are trying to avoid is making payment for land but not getting a valid executed/notarized deed.
- Require seller to send you the notarized deed before you send payment to the seller.
- Use a mobile notary. Send the prepared deed for the seller to notarize, along your cashiers check for payment, to the mobile notary with explicit written notary instructions that require that seller sign and give the deed to the notary for notarization and sending to you before the notary hands over the check to the seller. If the seller is unwilling to sign, then instruct the notary to not give the seller the check and instead instruct the notary to call you to see if you can resolve any issues while they are still with the seller. If you cannot be reached, ask the notary to call you as soon as practical and let them know you will pay the notary for 2nd trip or if they need return the check and the unsigned documents due to seller's refusal to sing - they still get paid. Mobile Notaries usually cost $75 to $150 - UPS store notaries usually cost $6 to $10 - so using this approach, you are essentially getting escrow services of ~$70 to $140. Don't forget to send payment for the notary services.
- if you and the seller are close enough geographically, you could 1) require a cashier's check from a nationally recognized bank and meet the seller at a UPS store / bank or other business that offers notary service and do the exchange.
When Selling:
- Require seller to send funds (personal check, cashier's check or money order) first. Then after you have deposited the cashier's check, or the personal check or money order has cleared, send the executed / notarized deed.
- Or go the mobile notary as the escrow agent approach. But, on the sale side you need to send an already notarized deed (use your bank / CU for free or a UPS store for cheap) to the mobile notary with instructions for them to collect a cashiers check (only - no personal check) in exchange for your notarized deed to the buyer. Be sure to instruct the mobile notary to collect the cashier's check before handing over the executed deed. IMPORTANT NOTE: To ensure the notary is willing to implicitly provide the exchange / escrow service, I send a "Receipt and Tax Reporting Acknowledgement" along for the Buyer to sign and the notary to notarize for a fee (thus I am purchasing notary services and not escrow service).
- if you and the buyer are close enough geographically, you could 1) bring a cashier's check and meet the buyer at a UPS store / bank or other business that offers notary service and do the exchange.
I have used all of the above at different times / circumstances.
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@karljames thanks for the informative advice.
@geoffrey thanks for the informative advice
I was able to do a demo walkthrough of a buy-side transaction through Fabrica last week, which (as far as I could tell) greatly simplified the process of receiving funds from a buyer... both in terms of getting past the trust barrier, and also in terms of providing key title documentation and making the process fast, without a third party closing agent.
As of now, it currently only works in California, New Mexico and Arizona... but I'm told it will be expanding into Texas, Florida and Colorado in the not-too-distant future. Hopefully some day this will work everywhere.
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@retipsterseth very interesting concept. Thanks
@ordep890
On the buy side for cheaper properties that I self close on, I simply email them the deed to print, notorize and send back to me. Then I send them an e-check or paper check through checkbook.io
If they are a really doubtful type, I will resort to the mobile notary approach.
On the sell side, you can also have them pay your with checkbook.io, or other payment service. Or even send a cashier's check in the mail. But confirm payment and then send in the deed. I send the deed to the county to record and have the county return it to them.
Once you get comfortable telling people that this is your process, they will feel comfortable with it too.
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I've successfully used Zelle (free for many banks) for the transfer of funds when buying (after I get the deed), and for selling (e-record or send them the deed after the funds arrive in my account). It's as fast as ACH, and actually safer since you're not even sharing your account#.
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