Real Estate

Different Closing and Possession dates

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  • Jul 23rd, 2020 1:40 pm
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[OP]
Member
Mar 26, 2015
234 posts
98 upvotes
Richmond, BC

Different Closing and Possession dates

About to close on a deal next month, however the seller wants to extend the closing date.

Our mortgage agent says that we can't extend.

Plan is to have the seller cover all costs, mortgage, taxes, insurance etc. for the week

What are the precautions I will need to take if the closing date and possession dates are a week apart?
10 replies
Deal Guru
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Mar 23, 2008
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Edmonton
gahafa wrote: About to close on a deal next month, however the seller wants to extend the closing date.

Our mortgage agent says that we can't extend.

Plan is to have the seller cover all costs, mortgage, taxes, insurance etc. for the week

What are the precautions I will need to take if the closing date and possession dates are a week apart?
You've probably got 3 professionals working this deal for you, and you're paying a good chunk of money to all three (indirectly in some cases, but they're still making money off their involvement in this). Your mortgage broker (who says you can't extend), your buyer's agent, and your lawyer. Why not use them to get specifics for your situation?

C
[OP]
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Mar 26, 2015
234 posts
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Richmond, BC
The more the merrier.

I like to be very informed in case they miss anything.
Deal Fanatic
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Oct 16, 2008
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Vaughan
gahafa wrote: The more the merrier.

I like to be very informed in case they miss anything.
Informative if you don't get GOOD advice from yours.
...
[OP]
Member
Mar 26, 2015
234 posts
98 upvotes
Richmond, BC
teoconca wrote: Informative if you don't get GOOD advice from yours.
It's hard not to worry that they missed something, it's a short time frame but I want to make sure I'm protected and there are wonderful people on RFD.
Deal Expert
May 30, 2005
47775 posts
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Richmond Hill
During the week, the property is yours but they are still there. That means they can trash your place if they wanted to.

Yes, fees definitely need to be covered. I would set it up as a "rental" so that the previous owners are "renting" the property from you for that week, so that they are tenants responsible for the property.
Member
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Aug 11, 2019
203 posts
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Toronto
What I would do in this situation:

Ask for an amendment in price. (Price reduction)
Hold back 5% of funds, in your lawyers trust account until possession.

Once you take possession and deem the house is in the condition you expect it to be, release the 5% of funds.

Of course, the sellers may not accept. This is what I would personally do if I was in your shoes.
Full Time Realtor
GTA & Surrounding Areas
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May 9, 2017
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If this is causing you issues, say NO!
Last edited by NotRobot on Jul 23rd, 2020 11:59 am, edited 1 time in total.
Deal Addict
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Jan 2, 2012
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Toronto
gahafa wrote: It's hard not to worry that they missed something, it's a short time frame but I want to make sure I'm protected and there are wonderful people on RFD.
As mentioned above, a holdback of funds is probably the best way. After they leave the property you can then release funds less your expenses for the 1 week.
Under no circumstances would I accept my expenses to be paid later on.

If they don't accept this, then tell them no deal and you demand possession on the original agreed date. Remember you are the only that must agree to this, so make sure everything is under your preferred terms and costs.
Deal Guru
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Feb 2, 2014
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Toronto
gahafa wrote: About to close on a deal next month, however the seller wants to extend the closing date.

Our mortgage agent says that we can't extend.

Plan is to have the seller cover all costs, mortgage, taxes, insurance etc. for the week

What are the precautions I will need to take if the closing date and possession dates are a week apart?
Why is your mortgage agent saying you can't extend?

The mortgage is based on the closing date, not possession date. So from a financing stand point, it doesn't matter if they still give you possession on the scheduled date.
Kevin Somnauth, CFA
Principal Broker - First Toronto Mortgage - MA (Ontario #13176, BC #X301007)
Real Estate Salesperson - Century 21 Innovative
[OP]
Member
Mar 26, 2015
234 posts
98 upvotes
Richmond, BC
CdnRealEstateGuy wrote: Why is your mortgage agent saying you can't extend?

The mortgage is based on the closing date, not possession date. So from a financing stand point, it doesn't matter if they still give you possession on the scheduled date.
Yeah, initially I wanted to extend closing date so it's the same as possession date.

But Since closing date cannot be extended then the possession date needs to be changed.

For the week long between closing and possession there is liability to the buyer (me).

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