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How and When to Use a Mail-Away Closing in Real Estate

Jul 29, 2020 by Liz Brumer

As a real estate investor, there may eventually come a time when you need to utilize a mail-away closing. Whether the property is out of town, the buyer or seller is in another area or state, you're away on vacation, or you're practicing remote investing, mail-away closings allow you to buy or sell real estate remotely. Learn what a mail-away closing is, how it works, and when a remote closing makes sense.

What is a mail-away closing?

Unlike a traditional closing where the buyer, seller, and occasionally real estate agent will meet at the title company or attorney's office to sign the closing documents, a mail-away closing allows the buyer and seller to sign and notarize the final closing paperwork remotely, returning the documents by mail. The title agent will review the paperwork for accuracy and completeness before sending the closing proceeds to the proper parties by check or wire transfer.

How mail-away closings work

While the closing process, in general, is fairly straightforward, the documentation that is needed for a closing will depend on the specific transaction and can change if a lender or loan is involved or if it's a cash closing. Local and state laws will also dictate small variances in the paperwork such as the number of witnesses needed on the deed, if any. But most closing paperwork will include or require:

  • Deed.
  • Settlement statement.
  • Closing disclosures and affidavits.
  • Loan documents (if applicable).
  • Copy of executed title insurance.
  • Copy of driver's license of all signing parties.
  • Copy of the company's operating agreement if the selling or buying party is a company.

Some closing agents will work with a designated mobile notary service while others allow the buyer and seller to use the notary of their choice.

Once documents are signed, they are returned with a prepaid shipping label typically provided by the closing attorney or agent in the closing package. If you're buying a property, it's important to have the funds wired to the escrow account prior to the closing date. If you're receiving funds as a part of the closing proceeds, the closing package will most likely include a proceeds authorization form. If electing a wire deposit, include a voided check linked to the account you want to receive the funds. The funds will be released to the parties on the closing date.

Tips for using mail-away closings

There is additional cost for choosing to do a mail-away closing, so investors should make sure this option makes sense for them financially. This method of closing was traditionally used out of necessity; many investors find mail-away closings are an easier option that reduces the travel time involved with a face-to-face closing, especially if they have access to a notary on site.

If you do find yourself involved in a remote closing, make sure to communicate the need to close by mail with the closing agent as soon as possible. This helps them prepare and send you the documents in sufficient time before closing. Review the closing documents carefully, as you would with any closing transaction, and request revisions if needed before signing and returning.

It's also a good idea to keep an especially sharp eye out for any places you need to sign or initial on the documents. Missing one signature could delay closing, as you now have to re-sign and return the documents by mail. Most closing companies will include explicit instructions on where to sign and what to include. If not, ask if any additional documentation may be needed that hasn't been specified in the package before returning.

As a remote real estate investor, I love being able to utilize mail-away closings and find them extremely easy to navigate. While they may not be right for every transaction, it's a helpful option to understand and be able to use when necessary.

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