When someone purchases a piece of real estate, one of the last steps in the process is going to be closing. At closing, they’ll have to sign numerous documents, facilitating the change in ownership. This is when the transaction is being finalized, the title is switching into a new person’s hands, and other contractual obligations are being fulfilled.
But if you’re buying a property, does that mean that you take possession of it immediately? Can you leave the office after closing and drive directly to your new property?
The possession date
This certainly may be the way that it works. In many cases, the purchase contract specifies that the possession date is the same as the closing date. As soon as the closing has been completed, the new property owner gets the keys. They immediately take possession, so the property is theirs, and they can enter at any time.
However, it’s very important to understand the specifics of the contract. In some cases, the possession date could be weeks or months after closing.
For example, when looking at residential home sales, sellers often want extra time to look for another house after they sell theirs. If the seller stipulated that the possession date is 60 days after closing, that means that the new owner doesn’t actually take control of the property for roughly two months. During this time, the previous owner is looking for a new house and making their own purchase.
This helps to show why it’s so important to understand purchase contracts and agreements in real estate transactions. Those who are going through these transactions need to know about all their legal obligations and their rights.
