Who needs to sign the disbursement directive, and does it have to be notarized? – South Carolina

Short Answer

In a South Carolina real estate closing, the disbursement directive is usually signed by the person or persons whose money is being disbursed or whose closing proceeds are affected. In many closings, that means all sellers, all borrowers, or any other party the closing attorney identifies as needing to approve the payoff and payment instructions. A disbursement directive usually does not have to be notarized unless the closing attorney, lender, title insurer, or a related closing document specifically requires it, but the attorney may require a clear signed copy before releasing funds.

Understanding the Problem

In South Carolina real estate closings, the question is whether the party involved in the closing must sign a directive telling the closing attorney how to send out closing funds, and whether that directive needs notarization before the attorney can act on it. The issue usually comes up when a seller, buyer, or borrower is asked to approve where money will go at closing and how the signed directive can be returned to the closing office.

Apply the Law

South Carolina requires a licensed South Carolina attorney to supervise a real estate closing. As part of that role, the closing attorney reviews the transaction documents, receives funds, and disburses money according to the parties’ written instructions and the closing documents. For ordinary closing disbursement directions, the key point is not notarization by itself. The key point is whether the attorney has reliable written authority from the correct party before releasing trust funds or sale proceeds.

Key Requirements

Correct signer: The directive should be signed by each person whose funds, payoff, or net proceeds are being directed. If title or loan obligations are held jointly, the attorney may require all affected parties to sign.
Clear written instructions: The directive should state where the money goes, such as a payoff lender, another closing charge, or the final proceeds account. The attorney needs enough detail to match the instruction to the closing file.
Attorney approval before disbursement: Because South Carolina closings are attorney-supervised, the closing attorney decides whether a scanned signature, emailed PDF, or other copy is acceptable for that file before funds are sent.

What the Statutes Say

S.C. Code Ann. § 26-2-210 (Attorney supervision of closings) – South Carolina law preserves the rule that a licensed South Carolina attorney must supervise a closing.
S.C. Code Ann. § 40-57-136 (Real estate broker trust accounts; disputes; records) – This statute governs real estate broker trust accounts and provides that disputed trust funds must remain in trust until resolved as provided by law.
S.C. Code Ann. § 38-75-1010 (Closing or settlement protection) – South Carolina law allows title insurers to provide closing or settlement protection and refers to written closing instructions in that context.

Analysis

Apply the Rule to the Facts: Here, the client is working with a law firm on a South Carolina closing and has been asked to provide a directive for disbursement of real estate funds. That usually means the closing attorney needs signed written authority from the person entitled to the funds or responsible for approving how those funds will be paid out. If more than one person will receive proceeds or if more than one person owns the property or signed the loan documents, the attorney may require each affected signer to approve the directive before disbursing money.

On notarization, a routine disbursement directive is different from a deed, mortgage, or recorded satisfaction document. South Carolina statutes impose witness and acknowledgment rules on some recorded real estate instruments, but a simple closing instruction for disbursement is usually an internal closing authorization rather than a document recorded in the land records. For that reason, notarization is often not required unless the attorney’s office, lender, or title insurer has made it a condition for that transaction.

As for delivery, many closing offices will accept a scanned signed PDF sent by email if the attorney can verify the signer and the instructions. A clear photo may be accepted in some offices, but a scan is usually easier to read and store in the closing file. Text delivery is less reliable because image quality, missing pages, and fraud concerns can make the instruction harder to verify, so the attorney may ask for email submission instead. For related guidance on secure proceeds delivery, see how to wire South Carolina sale proceeds safely after closing.

Process & Timing

Who files: The seller, borrower, or other party whose funds are being directed signs the directive. Where: It is returned to the closing attorney’s office supervising the South Carolina closing. What: The signed disbursement directive, usually with wiring or payoff details if requested. When: Before the attorney releases funds at closing, and ideally as soon as the attorney requests it.
The attorney reviews the directive against the settlement figures, payoff information, and other closing instructions. If the signature, account details, or authority are unclear, the office may request a better copy, additional identification, or signatures from other parties.
After the attorney confirms the closing conditions are met, the office disburses funds from the trust account and issues the final settlement or closing paperwork. For more on the attorney’s role in coordinating the closing, see how a South Carolina closing attorney coordinates the transaction.

Exceptions & Pitfalls

If the property or proceeds belong to more than one person, one signature may not be enough. The attorney may require all owners or all parties receiving proceeds to sign.
A photo sent by text may be rejected if it cuts off the signature, account number, or full page. A complete scanned PDF is usually safer.
Wire instructions create fraud risk. Many offices will not rely on last-minute instructions sent by text or from an unverified email and may require verbal confirmation or a secure process before sending funds.
If there is a dispute over who gets the money, South Carolina trust-account rules generally require the funds to remain in trust until the dispute is resolved by written agreement, court order, mediation, or interpleader.

Conclusion

In South Carolina, the disbursement directive usually must be signed by the person or persons whose closing funds or proceeds are being directed, and all affected parties may need to sign if ownership or payment rights are shared. It usually does not need notarization unless the closing attorney or another closing requirement specifically calls for it. The next step is to sign the directive and send a clear scanned copy to the closing attorney before funds are scheduled to be disbursed.

Talk to a Real Estate Attorney

If a South Carolina closing requires a disbursement directive and there are questions about who must sign, whether a scanned copy is enough, or when funds can be released, our firm can help explain the process, confirm the required signatures, and help avoid delays.

Disclaimer: This article provides general information about South Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed South Carolina attorney.