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What is a "closing date" in a real estate purchase?

Closing On Your Property

John Caliendo (Realtor) gives expert video advice on: What can I do if the seller backs out of selling me their home? and more...

What is a "closing date" in a real estate purchase?

A closing date is the projected target date of when the ownership will transfer. In my experience, this is truly a target date, as there are several factors beyond anyone's control such as banks, county assessor's offices, title insurance companies and so forth and so on. But to answer the question, that is the date where ownership will transfer.

How long does it take to close on a real estate transaction?

When buying a home, when it comes to closing in on a real estate transaction, in my experience, the vast majority of escrow periods are anywhere from 3 to 45 days. It takes at least 17 to 21 days to process the loan, because that involves compiling the file, having the appraisal performed and getting it off to the underwriter. Then, in turn issuing what's called loan documents, which need to be signed and then returned to the lender. Again, that's about 21 days, along with all the other logistics involved with a purchase, such as the home inspection, city reports, and review of disclosures. Therefore, basically 3 days is probably a comforting period of time that you can accomplish your real estate transaction in.

What is the best time of the month to close on a home purchase?

When buying a home, the best time of month to close in on a home purchase assuming and providing that there is a loan associated with the transaction, is probably to close more towards the end of the month. The reason behind this is that your lender is going to charge you interest from the date they release the funds to you, to the end of the month. If that can end up being fewer days than more days, then it will be a good thing to close a home purchase transaction later on in the month.

What are "real estate closing costs" and "title fees"?

When it comes to buying a home, real estates “closing costs” and “title fees” are a function of their lenders' agreement, so it's probably a better question for the lender, and that would be negotiated and agreed upon early. In other words; are we paying points on the loan, no points, what's the percentage rate, what's the incentive on the loan, what is the title insurance company? Therefore, again both “closing costs” and “title fees” are definitely lender questions.

Can the closing date on a real estate purchase be extended?

When it comes to buying a home, the closing date on a real estate purchase can be extended and in my experience we have extended quite a few escrow closing dates. There's a host of reasons that could surface to cause either side to want to extend their escrow. It has to be in writing and agreed by both sides. Some examples could be, maybe the sellers' place that they are heading off to is not ready yet and they have nowhere to go, therefore may ask for an extension of a few days. Now, one thing that can happen is what is called a sale leaseback where you actually close escrow, the seller stays in the property for a short period of time, often times compensating the buyer, basically paying their principal, interest, taxes and insurance for every day that they are in that property.

What happens at the closing of a real estate purchase?

When buying a home, what happens at the closing of a real estate purchase varies by region. In certain parts of the country, the closing of a real estate is a very formal ceremony, for lack of a better term, where everyone; the buyer, seller, the two agents, attorneys, and title reps are in the same room and it really is quite formal. In other states like mine, the closing of a real estate is a very passive-aggressive sort of event in that you're basically sitting back and waiting for confirmation from the county that the deed has been recorded. So, the closing of real estate purchases varies by region, again, going from very formal to very informal.

What can I do if the seller backs out of selling me their home?

If the seller backs out when buying your home, as the saying goes, for reasons beyond his or her legal right, in others words, you are within the safe, healthy confines of an agreement and they decide not to perform, then you do have the option to sue for what is called specific performance, which basically means do what you agreed in writing to do.

What can the seller do if I want to back out of buying their home?

The buyer has several means to legally cancel the escrot. But, once that date has come and gone, if the buyer chose to reneg their deposit could and would be in jeopardy and this is called liquidated damages. Compensating the seller for the damages he or she incurred by the buyer locking the property up and then walking away.