In residential sales using the Florida Realtors/Florida Bar AS-IS Contract, everyone talks about “closing,” but there is a common misunderstanding on exactly when closing legally occurs. That lack of clarity frequently causes unnecessary conflict—especially when sellers insist on holding possession, keys, or access until they “see the wire” or receive separate proof of funds. The contract is actually very clear on this point, and understanding it prevents disputes, risk-of-loss problems, and awkward post-closing stand-offs. Paragraph 4 of the AS-IS contract defines Closing as the moment when two things have occurred: “when all funds required for closing are received by Closing Agent and Collected pursuant to STANDARD S and all closing documents required to be furnished by each party pursuant to this Contract are delivered (‘Closing’).”
In other words, Closing occurs when the closing agent (the attorney or title company) has received all required funds and documents. Not when the seller receives proceeds. Not when the seller “sees” a bank confirmation. Not when everyone feels comfortable.
Once escrow confirms receipt of funds and documents, the transaction is closed under the contract. So, when does the transfer of keys have to happen? That has to happen at “Closing” as possession must be transferred at Closing. Paragraph 6 (Occupancy and Possession) is equally clear: “Seller shall, at Closing, deliver occupancy and possession of the Property…and shall deliver all keys, garage door openers, access devices and codes…to Buyer.” There is no contractual provision allowing a seller to add a new requirement such as “proof of wire” or a Fed reference number before delivering keys.
I Want My Money First: Buyers are not required to pay the Seller. Buyers are required to pay the closing agent. Once that happens, the closing agent (not the seller) determines that funds are received and “collected” as defined under Standard S of the contract. Everything else is personal preference, not contractual language, unless additional terms are added in. While it is understandable why a Buyer wants a wire confirmation or funds in their account there are reasons why this is not how it works for the benefit of both parties.
The Hidden Danger: Risk of Loss: Here is the part that matters most and is almost never discussed: If the contract says closing has occurred, then risk of loss has shifted, even if the seller is refusing to turn over keys. Imagine a property is struck by lightning the same afternoon. Under the contract, the buyer now bears that risk, but the seller is refusing to deliver keys. That is the exact “closed but not really closed” limbo the contract was drafted to prevent.
Delayed Payment: Sometimes payments are held or delayed, even if done via wire. An OFAC hold, a Seller giving a wrong routing number, an invalid account number. Many things occur that do not allow funds to be transferred the same day, and the Buyer cannot be penalized for a Seller’s or even Closing Agent’s mistake. Neither should the Seller want to risk delaying “Closing” as that potentially keeps the Risk of Loss on them.
But That Is How We Always Do It: Real estate practice customs are not contractual obligations. If a seller wants receipt of funds or confirmation of wire transmission as a condition to releasing keys, it must be negotiated and written into the contract. Otherwise, the contract controls—and Closing means what the contract says it means.
Closing occurs when funds and documents are delivered to the closing agent. Possession is required at that moment. Sellers cannot unilaterally require proof of wire, confirmation numbers, or separate verification.
If a seller wants those protections, they must be negotiated into the contract, added to additional terms or otherwise they do not exist. This issue arises constantly in residential closings, and the solution is always the same: follow the contract. When we represent Buyers it is important to avoid the limbo of “closed, but not really closed.” The contract defines closing for a reason.