Do you think that the last day of the month is the best day to close on your home purchase? It may not be true. Closing on the last day does not allow for any unforeseen circumstances. What about selling a home in the morning and buying one that afternoon? Very common but boy is that one a gamble. Let me illustrate this by relating a true story.
A client of mine was closing the sale of their home at one Title Company in the morning. Immediately following that closing they were to go to a second title company to complete the purchase of their new home. A problem developed when the folks buying my client’s home could not get their loan papers to the title company on time. We were set for a Thursday closing. We moved it to Friday and still no papers. We moved it yet again to Monday but still no papers. We finally heard that the client was officially withdrawing their offer due to their inability to arrange financing. They went through three different lenders with no success (wish they would have called me).
What that did was leave my clients high and dry. Without the sale of their present home, they were unable to close on their new home and were forced to withdraw their contract.
So now you have a couple with three children and a fourth on the way in a house that is completely packed up ready to move. They must now unpack and prepare their house to be relisted for sale. They must also decide whether or not to go through with the purchase of that new home and try to handle two mortgage payments or to wait and see if their present home sells quickly and avoid the double mortgage.
Remember, I am a Mortgage Broker, not a Realtor, so I what I tell you is of my opinion and you should always trust the advice of your Agent!
What most lenders will tell you is that closing both homes on the same day is normal and it should always be done that way. I would like people to consider closing on the sale of their house on a Monday or Tuesday. Then negotiate a ‘lease back agreement’; this simply means that you would lease the home you just sold from the new owners for two days. You would then close on your new home or Thursday of the week before the end of the month. This gives you ample time for the proceeds of the sale to reach your bank; it also makes sure you have time to gather all of the documentation you need for the next closing. Should anything go wrong with the sale of your home, you now have a few day window to work out any problems. It also enables you to leave your home intact until the sale is final….then you can pack up your house.
Again, I am a Broker and am not paid to give you real-estate advice; a Realtor is, so this is just my opinion.