Why is it smarter to use a digital Earnest Money Deposit payment platform?
The shift to digital payments in Real Estate.
Real estate companies are always looking for ways to make buying homes easier for their customers and staff. They've used technology for things like e-signatures, document sharing, and notary services, but one thing that's still outdated is the way payments are made. While the shift to digital payments is gaining serious momentum, many real estate companies are still heavily relying on tedious and risky checks and wires.
Digital earnest money payments are safer and more secure than checks and wire transfers
Check and wire fraud in real estate transactions is a significant concern and continues to climb in double digits each year. The FBI reports that 11,578 home buyers lost over $350M in 2021 alone due to check and wire fraud, and only 15% of cases were reported. Yikes!
Simply put, the manual nature of checks and wires and the lack of any fraud remedy process will continue to attract unwanted attention. On the flip side, platforms like Payload are designed to reduce these risks by offering end-to-end security features that protect payments from start to finish. To name a few, these platforms only allow transfers within the United States, they have built in fraud protection and account verification tools, and in the event of fraud, they have a recourse framework designed to protect victims.
Digital earnest money payments are more convenient
A trip to the bank for a wire transfer or mailing/delivering a check takes a lot of time and is a problem for buyers, agents, and people who hold the money in escrow. It's also becoming less common since people have adapted to new ways of paying for things, like Venmo and Zelle.
Digital earnest money payment platforms like Payload offer real estate companies and their clients a modern approach to payments, accommodating simple payment requests or instructions that mimic the methods they use regularly. Picture Venmo, but for real estate. Aside from the user-friendly nature of the payment experience, homebuyers, agents, and escrow holders enjoy real time payment notifications, receipts, and traceability that you can’t get with checks and wire transfers.
Digital earnest money payments have lower costs
Wire transfers and certified checks are expensive, time consuming, and oftentimes carry ancillary bank fees for senders and/or receivers. Personal checks may not cost much upfront, but soft costs add up quickly when considering time spent. Not to mention, who still has a checkbook these days?
Electronic EMD payments are processed at a fraction of the cost, carry no bank fees, and due to the quick payment experience, soft costs are eliminated. Platforms like Payload are virtually free to the real estate company as the nominal transaction fee is passed to the homebuyer.
Digital earnest money payments offer more control
Wire transfers, checks, and even traditional ACH payments lack any meaningful data, reporting, or integrations. This brings administrative teams the extra hassle of reconciling these payments manually on an ongoing basis. Homebuyers are at the mercy of their bank or the receiver’s bank for any types of alerts or payment confirmations, which are usually nonexistent.
Using digital payment platforms like Payload will bring full transparency to the payment experience, offering administrators and homebuyers rich data, platform integrations, reports, receipts, and proactive notifications. For admin teams, what once took hours to manage now takes minutes.
It’s time to modernize your real estate payments
Wires and checks are slow, tedious, expensive, and pose an ever increasing fraud threat to real estate companies and their home buyers. Through technology advancement and innovation, digital payment platforms like Payload are delivering game-changing security and convenience to the real estate community. And the movement is growing quickly - over the last 3 years, home buyers have paid hundreds of thousands of Earnest Money Deposits through a digital platform.
Want to know what other features you can get with Payload? Check out our Real Estate page and sign up for a demo!