What is a Wet Settlement?

A Wet Settlement refers to a loan closing process in which the funds are disbursed immediately at the time of closing. This means that both the buyer and the seller complete all necessary documentation, and the lender provides the funds to finalize the transaction on the same day. This type of settlement allows for immediate access to the funds, which can be beneficial in real estate transactions, enabling the buyer to take possession of the property right away.

In contrast, other options do not accurately describe a Wet Settlement. Online closings relate to the method rather than the timing of fund disbursement. A settlement without legal documentation does not meet the requirements for a binding transaction, and a type of mortgage that is not insured does not pertain to the closing process but rather the nature of the mortgage itself. Thus, the key aspect of a Wet Settlement is the immediate availability of funds at the closing table, making the transaction final and actionable right then and there.