Homeowners who are planning to move are often faced with the dilemma of – “What do I do first? Buy or sell?” Depending on your specific circumstances, it may be beneficial do to one or the other first. However, it is popular for homeowners to want to try to pull off both at the same time which can be a challenge unless the stars align for the sale and purchase to happen concurrently.There are numerous reasons why someone may choose to a simultaneous closing despite the challenges, such as:
- Knowing you will have a place for you and your belongings when your home is sold and possession transfers to new owners;
- Being able to use the proceeds from the sale of your home toward your new purchase; and
- Best of all, you will only have to move once – out of the old place and into your new place!
Whether you had always planned to have a simultaneous closing or the opportunity fell in your lap, and you find yourself working toward both a sale and purchase at the same time, here are some important things to consider:
- Contingency: If you are planning to use the proceeds of your sale to make your purchase, make sure that your contract includes a contingency. You do not want to find yourself unable to purchase your new home and in default of your purchase contract because your sale fell through.
- Notice: Make sure that everyone involved with both transactions knows that you are working toward a simultaneous closing. The more notice all parties have, the better they are able to serve you and prepare for the closings.
- Documents: Keep in mind you will need to be available to sign documents for both your sale and purchase. If your purchase will be funding in part with a mortgage it is possible that you will need to be present on the day of closing to sign date sensitive closing documents, or have them executed in advance for delivery on or before the closing date. For your sale, you will be required to provide the closing agent with an original signed deed, while not date sensitive the original will be required for closing.
- Closing: Plan your closing time ahead. Remember that you will not have access to your sales proceeds until your sale transaction is complete. Therefore, you should coordinate with your closing agent to complete your sale transaction early enough in the day that the sales proceeds will be available for your purchase. If there are two different closing agents involved, communication is key to make sure you get the sales proceeds you need into the trust account of the closing agent that is assisting with the purchase.
Keep in mind, having the right real estate professionals to help coordinate all of the moving parts of your simultaneous closings and to resolve any issues as they come up will make a world of difference in achieving smooth simultaneous closings. Please contact your real estate attorney if you have any questions.
Berlin Patten Ebling, PLLC
Article Authored by Natasha Selvaraj, Esq. firstname.lastname@example.org
This communication is not intended to establish an attorney client relationship, and to the extent anything contained herein could be construed as legal advice or guidance, you are strongly encouraged to consult with your own attorney before relying upon any information contained herein.
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