Wet Funding

Wet funding is a method of real estate loan closing in which all loan documents are signed, funds are disbursed, and the transaction is completed on the same day. Under this process, the lender provides the loan proceeds immediately after the borrower executes the required closing documents, allowing ownership and financing to be finalized without delay. Wet funding is commonly used in states where local laws and lending practices permit same-day funding and recording procedures.
The term “wet” refers to the fact that the ink on the signed loan documents is still considered “wet” when the lender releases the funds. This differs from dry funding, in which signed documents are reviewed and approved before money is disbursed, often resulting in a waiting period of one or more business days. Wet funding can accelerate real estate transactions and provide greater certainty at closing, but it also requires lenders, title companies, and settlement agents to complete document verification and funding requirements within a compressed timeframe.