Instant payments a ‘necessary revolution’ for real estate transactions
As the FedNow® Service network grows, the Innovation Spotlight series explores use cases that are changing the way businesses and consumers make payments. This edition covers the benefits of instant real estate transactions, with insights from paymints.io (Off-site), a fintech that provides a digital payments platform for title companies and real estate brokers, Payload (Off-site), a fintech that integrates inbound and outbound payment capabilities for a variety of business and software platforms, and Stewart Title (Off-site), a leading global title insurance company.
Whether buying, building or managing properties, the real estate industry depends on verifiable funds that can be made available immediately. These transactions are often complex, with payments issued to a number of parties — and through separate payment flows — before a transaction is complete. In many cases, real estate transactions also involve manual payment processes, which can lead to inefficiencies and costly delays for everyone involved.
These manual payments can negatively impact the overall speed and experience of a real estate transaction, according to Jason Doshi, CEO and co-founder of paymints.io. “When you buy a house, for example, you apply for a loan digitally and sign documents digitally, but buyers don’t necessarily have a way to send funds online — you have to use either a paper check or a wire payment,” Doshi said. “This fragmented experience causes additional stress for homebuyers and can introduce delays that impact everyone involved in the purchase.”
According to Zach Jacob, vice president of business development with Payload, this friction and complexity makes real estate transactions a prime candidate for innovation. “There can be 10 to 15 different payouts that a title company may issue on the outbound side of a home purchase, whether it’s an agent payout, the mortgage payoff or paying a utility company before finalizing a sale,” Jacob said. “We’re seeing demand to move toward faster, irrevocable payments that ensure all parties, on either side of the transaction, can be paid quickly and efficiently.”
To address these pain points, organizations across the real estate industry are looking to instant payments. For one-time real estate deals and recurring transactions like rent payments, the FedNow® Service enables secure instant payments through participating financial institutions, around the clock, every day of the year.
A solid foundation for faster real estate transactions
FedNow Service instant payments are final, irrevocable and “always on,” providing immediate settlement and availability of funds to the recipient 24x7x365. When the timing and availability of funds is critical, instant payments can streamline complex payment flows between multiple parties. Innovators in the real estate industry see this streamlining as a crucial step toward efficiency and customer satisfaction.
“The FedNow Service is an ideal solution for the real estate industry because it directly addresses the problems the industry needs to solve,” Doshi said. “As the industry adopts instant payments, we’ll see these time-sensitive transactions become faster and more convenient, and we’ll be able to leverage key risk mitigation features to prevent bad actors from derailing these transactions. By offering 24x7x365 payments, we also remove the urgency to make it to a bank before it closes or to send a payment in a time crunch to meet a processing deadline. Users are looking for this ease and convenience, so it’s the experience we help our clients deliver.”
The benefits of instant payments extend beyond the parties paying into or out of an escrow account. For Bob Taylor, vice president of centralized escrow accounting at Stewart Title, the FedNow Service offers a “necessary revolution” in real estate payments that will help modernize the title industry and its role as a kind of gatekeeper in these complex transactions.
“The finality of instant payments is very attractive to us and feels like a faster, modernized version of the wire payments that have long been our standard,” Taylor said. “This finality helps us stay in compliance with the many regulations that are top of mind for us as the title company managing those efforts. Being able to transparently track funds — who sent what, along with when and where those funds went — and having the assurance that these funds will settle immediately helps us deliver best-in-class service to sellers, brokers, agents and more.”
Embracing innovation with the FedNow Service
Given the number of parties involved in many real estate transactions, a wide network of instant payment adopters is crucial for this innovation to expand across the industry. As the FedNow Service network continues to grow, Payload is working to integrate instant payments into its real estate platforms in 2025. Jacob highlighted the key role that financial institutions play in this evolution.
“We continue to see demand from brokers, title companies and consumers, and constant demand around use cases like earnest money and cash to close,” Jacob said. “We want our solution to not only meet this demand but also drive major changes across the real estate industry. Focusing on that seamless end-user experience for higher-value real estate transactions, financial institutions can help accelerate this innovation by enabling individual customers or members to use instant payments.”
According to Taylor, organizations in the real estate industry should see the FedNow Service and instant payment integration as an inevitable update to current payment processes, and they should plan accordingly.
“Across the industry, there’s agreement that we want to enable a homebuyer to submit their closing funds on their mobile phone, for example,” Taylor said. “To get there, we have to continue to educate across the industry about instant payments — not just their benefits but also how they work, how instant payments compare to our current processes, and how the systems we rely on can be upgraded to support instant payments today.”
Real estate transactions underscore the ways instant payments can streamline complex processes and make payments more efficient. For more on instant payments in the real estate sector, watch an excerpt from our recent FedNow Service Town Hall featuring Jason Doshi of paymints.io.
Organizations innovating with the FedNow Service can tailor the use cases they support to fit the needs of their customers or members. How will your organization innovate with the FedNow Service?
The Innovation Spotlight series demonstrates the ways financial institutions, certified service providers and ecosystem providers are driving innovation with the FedNow Service. To learn more about innovative FedNow Service use cases, read our Innovation Spotlight on microdeposits or explore the Use Case Arena (Off-site).