Wet Funding vs Dry Funding (Table Funding)

Wet state vs. Dry state

First of all, in regards to real estate and mortgage lending, this has nothing to do with alcoholic beverages! Rather, this refers to the laws and customs in different states regarding when a new mortgage loan is closed and when new buyers may take possession of the property.

"Wet States", states that have "Wet Settlement" laws, require lending banks to disburse funds within a period of time. Depending on the states' Wet Settlement laws, some require the disbursement of funds to the sellers and other involved parties on the day of the settlement, others within 2 days of closing. Wet Settlement laws are in place to curb the bank practice of delaying funding after closing documents have been signed by the borrowers. All of the prior to funding conditions must be met in order for the lender to allow doc to go to closing in Wet States.

Table funding: This is when you close a loan in your company's name and immediately thereafter turn the loan over to a lender. That's the definition as per HUD, but this term is commonly used to describe disburement of funds immediately upon signing.