When Does the Buyer Get the Keys After Closing on a House?
A home buyer called me for advice regarding access to the home after “closing”. Apparently the closing had been scheduled for 6 pm on the Friday before a long holiday weekend. The buyer explained that he had been living in his RV for the past two weeks as he was re-locating from the Midwest. He was excited to complete his closing so he could get his keys and move into his new house over the long holiday weekend.
He was shocked and upset to learn that he could not get his keys even though he had just signed hundreds of documents to complete his home purchase. But even though he had signed the documents, including the mortgage, note and closing statement, the late hour prevented the funding from occurring which meant that the seller had not received the proceeds from the sale.
The buyer was upset. The prospect of spending the long holiday weekend in his RV was something he was not prepared to do.
One of the most overlooked components of a real estate transaction is what happens when the ink dries on the stack of documents everyone signed during the closing, however funds are not available.
Buyers typically think they get keys right away upon signing. But before they can get the keys to the property they just purchased the monies need to exchange hands. In this day and age funds can often be wired to financial institutions very quickly. But if a closing happens at 6 pm on a Friday the possibility of the seller getting paid that same day is slim to none. Which means the buyer isn’t getting his keys until after the long weekend. The FAR/BAR Contract states that the Seller shall deliver occupancy and possession of the Property to the Buyer at Closing. The term “Closing” is defined as when the closing documents required to be furnished by each party pursuant to the contract are delivered. Although there is no mention of delivery funds or funding in the definition of the term, the contract makes mention of funding in Section S, which defines the term “collected” referring to amounts required to close. The FAR/BAR Drafting Committee is currently working on clearing up any discrepancy as to when the keys can and should be released. The revisions to the FAR/BAR Contract are due to be released in the early part of 2019.
Our firm is happy to provide you with ample communication and convenience to help you have a smooth real estate transaction. And that includes having an understanding of when you can expect to get your keys after you have completed your transaction.