Is a settlement date the same as a closing date?
When it comes to buying or selling a property, customers frequently find that complicated lingo is used which leaves them feeling perplexed and lost. With the process already being incredibly complex and at times stressful, we do our best at FastCash4Houses to simplify the terms for our clients. In this article, we will be explaining to you what exactly settlement date entails, and what the difference is, if there is any, between the settlement and closing date. With this, we hope that all of your worries and confusion will be subsided.
What is the settlement date?
In property, the settlement date is the date when a trade is finalised, and the buyer is obliged to make payment to the seller while the seller passes on the property to the buyer. The term ‘settlement date’ can be applied to a number of situations including stocks and bonds, government securities and options, and spot foreign exchange. In real estate, this refers to the date on which ownership of the property officially changes hands. It is at this point that the home seller receives the proceeds resulting from the sale and the buyer pays any associated costs which are required to complete the transaction. The home sale settlement process lasts roughly an hour on average, but it may take longer if the buyer and seller are required to settle possible final disagreements.
What is the difference between settlement date and closing date?
It may surprise readers to find out that ‘settlement date’ and ‘closing date’ are terms which refer to the same thing. They both reference the date when a property’s seller and buyer meet to finalise the deal. As previously stated, this is the time when the deed to the property is transferred from the seller to the buyer and all applicable paperwork is completed.
Where does settlement occur?
The settlement meeting can occur in a number of different locations. This includes the office of a title company, lender, or attorney. The costs associated with the settlement are also required to be paid at this time.
How is the date set?
The settlement date is normally set when the buyer makes their formal written offer to purchase a property. The seller may accept the date or will suggest one they find more appropriate, and the process will carry on until they agree on a date. In spite of this, the buyer’s mortgage lender usually has the final say about the date to make sure it has time to complete the underwriting process. On average, a settlement time frame is 30 days from the offer to the closing date, though this is of course subject to variation.
We hope that this article has helped to subside any worries or queries you may have had regarding the settlement date. At FastCash4Houses, we are here to support you every step of the way with demystifying the property ownership process and understanding your role in the procedure.