What does the Good Funds Act require regarding the distribution of funds?

The Good Funds Act mandates that no funds be distributed until the closing documents have been officially recorded with the appropriate governmental authority. This requirement is designed to ensure that all parties involved in a real estate transaction are protected and that there is a transparent process in place for handling funds. By prohibiting distributions prior to recording, the Act helps to mitigate risks associated with potential disputes over ownership or claims on the property after the transaction has taken place.

This principle underpins the integrity of real estate transactions, ensuring that fund distributions are contingent upon the successful completion of legal formalities, thus safeguarding buyer and seller interests. Moreover, it upholds the reliability of the closing process, fostering trust among all parties involved.