What could be a consequence of failing to comply with closing instructions?

Failing to comply with closing instructions can significantly elevate the risk of theft and fraud of funds during a real estate transaction. Closing instructions outline the specific requirements and procedures that must be followed to complete the transaction securely and accurately. When these guidelines are neglected, it opens the door for unauthorized access to funds, misallocation of assets, or fraudulent actions carried out by individuals who may take advantage of the disorganization or lack of proper controls in place.

For instance, without clear instructions, a title agent or involved parties may inadvertently expose sensitive information or funds to potentially dishonest actors. Furthermore, if funds are not managed according to the outlined closing procedures, it can lead to mishandling, resulting in financial loss or legal complications for all parties involved. Ensuring adherence to closing instructions is essential to maintain the integrity of the transaction and safeguard against such threats.