Completion and possession dates. Understand the difference.
As you find your way through the real estate market, you may hear terms of “completion date” and “possession date” mentioned, and sometimes conversations about these important dates are overlooked. It’s important to understand the difference between these dates, as they can affect the timing and logistics of the home-buying process, as well as legal liability and insurance coverage. For instance, if possession were to happen before completion, the buyer would have access to the property before the seller receives payment, which is not ideal if a problem with the home should arise. Additionally, it’s important to ensure that insurance coverage is effective on completion to avoid potential risks and damages.
The completion date is when legal ownership is transferred from the Buyer to Seller by their lawyers or notaries, and simultaneously, the Seller receives payment for the property.
The possession date is the day the Buyer officially takes possession of the property, marked by the passing of keys and eating of the celebratory pizza and cheers of champagne.
Generally, on a purchase only we like to keep at least 1 day between the completion and possession dates to avoid situations where completion is late and we have someone in their moving truck waiting to move in. These dates become very important when buying and selling real estate at the same time because your realtor needs to ensure that the completion dates of your sale happen before the completion dates of your purchase.
When purchasing new construction the developer should give you a heads-up that completion is imminent. In new construction, the possession date is nearly always the day after completion. Book early to make sure you get the best move-in times.
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