Are Their Advantages to a Particular Closing Date?

When representing a buyer and writing an offer, one of the question I like to pose, “When do you want to close escrow?”

At least 90% of the time, no one has a clue as to when or why they should consider the options.

First, let me say that as a buyer you do not always have control over when the escrow will close. There are many factors that can and do contribute to delays that are completely out of the buyer’s control. At times, escrow will have missed a critical bit of information (Never my escrow; Michelle at Fidelity in Hemet), which can cause a delay of a day or two to a week or two. Then there are the underwriters at the mortgage companies…they have certainly been known to drag their feet and not get everything that is needed on time. And of course, either party to the transaction just may not be as on the ball as everyone else would like that can also delay a closing date.

For the sake of this article, I will not be focusing on what can go wrong with an escrow but rather the strategy of a closing date.

Lets’ say you want to close your escrow on March first. Now your closing costs will be the prorated interest for the entire month of March (this is like having an extra monthly payment due at the close of escrow); however your first payment then won't be due until May first.

The alternative strategy is if you close escrow on February 29^th, you only have to produce one days worth of interest as part of your closing costs. Just know that you will then have your first monthly mortgage payment due on April first.

The trade-off is how much money you bring to escrow and when your first payment will be. Figure it out and see if you can’t make a decision that works best for you and then try like the dickens to get every one committed to that date…including the seller, your lender, escrow, title and of course both REALTORS® involved in the transaction.

If you have any other advantages or disadvantages that should be considered, please go ahead and leave a comment for my other readers to consider.

Now Have a Blessed Day,

John Occhi, REALTOR®
Century 21 Crest - CrestREO
CrestREO.Com
Hemet - San Jacinto Valley
951-927-9473

Author of "What You Need to Know...About Foreclosure and How You Can Stop It!" - If you are a Hemet or San Jacinto Homeowner.

This blog and the contents written here is the intellectual property of John Occhi, Hemet California REALTOR®. The views and opinions expressed are just that - views and opinions of John Occhi and those who comment. Please note that I am not an attorney or a tax professional and any time I discuss either topic, I suggest you consult with the proper professional for relevant assistance.

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