3 Things to Know About Negotiating a Closing/Move-in Timeline
Thu, February 18, 2016
In real estate, timing is a critical ingredient that can shape the sale. Relocation logistics, the timeliness of a lender to process a loan and even the availability of local contractors to fix things required by an inspection can drive, or delay, the closing date. Here are a few things to consider as you and your agent work to set closing and move-in dates.
1. Speed can tip the scales
Do you have your loan in hand and the flexibility to move out of your current home? Depending on the seller’s situation, this could be a tasty carrot in the negotiation process. Your agent may be able to feel out the seller’s urgency (or lack thereof) to sell and determine if they might accept a lower offer for a faster settlement.
2. Going long
Asking for a delayed settlement date, longer than 30 or 45 days, is another option, but generally less appealing to sellers. Each day is another opportunity for something to go wrong that could kill the deal. The buyer’s financial situation could change, or they might find a home they like better.
As a seller, if you are considering accepting a long closing date, an agent may suggest increasing the amount of earnest money stipulated in the contract. Also, you’ll want to consider adding the additional months’ mortgage you’ll be paying to the asking price.
3. Considering “rent backs”
Closing quickly and then renting the home back to the seller can make the schedule work for buyers or sellers who might not be able to pack up and move immediately. With this option, the buyer faces the greater risk. What if there’s a fire, a flood or a pack of crazy teenagers that run amuck during the rental period? If you consider the rent-back route as a buyer, work with your agent to develop a solid rental contract that spells out liability.
With years of negotiating experience and an in-depth knowledge of the current local market, a savvy Realtor can build a sales timeline that works to your benefit, both financially and logistically.