As spring is turning into summer, the Kelowna Real Estate Market is heating up with lots of activity. As a consequence of the recent market cycles many Sellers have wisely taken a “Sell First” then buy approach to their home purchase. The result of this is that many “Buyers who have Sold” are looking to purchase immediately and complete as soon as possible, and one of the common questions I am asked is “how much time do you need to get a real estate purchase done?”
For our law office perspective, we have the ability to complete most deals in 24 hours if the Buyer and the Seller are available to attend in person and it is a cash purchase of a fee simple home. We accomplish this by having a law office that is built for real estate sales and purchases whether that is a 25 million dollar development or a 250,000 condo.
An important caveat here, is that there are many third parties to real estate transaction that also need some time to get things in order as well:
1) BANKS and LENDERS – mortgage approvals will take 7-10 days for most transactions (usually during subject removal) and then instruction and funding of mortgage will often take a further 3-5 days for credit unions and major banks and up to 14 days for secondary lenders. For sellers, a payout statement is required to be obtained. Although most institutional lenders will readily provide this within 1-3 business days, if there is a private lender on title their timely cooperation cannot be relied on and extra time will be needed for the Seller’s law firm to obtain a dischard.
2) STRATA CORPORATIONS – forms need to be obtained from strata corporations and it is prudent practice, as a purchaser to always personally review the bylaws and the strata rules. Depending on the strata these documents can take a few days to obtain, and although they can be obtained on a rush, rush documents can be very costly. At least 1 clear week is needed to obtain strata documents without penalty (See Form F Rules Here)
3) INSURANCE COMPANIES – in all cases proof of insurance is a requirement of the mortgage lender and the lawyer is required to obtain an “insurance binder” on behalf of the lender. Most local insurance companies (perhaps accustomed to the speed of our real estate process) usually have binders to our office within an hour or so, however “internet based” or out of province insurers usually are not as responsive.
4) CLIENT AVAILABILITY – surprisingly it is either the Buyer or the Seller who is having difficulty making themselves available to complete the transaction. For Sellers, they are packing their bags and moving on, but they still have to attend at a lawyer’s office to sign the paperwork either on or just before the closing date. For Buyers, who are usually in the middle of packing up their entire household and trying not to forget the pets and kids…. it is important that they remember that the deal is not done until you have the keys and are moving in!
For Realtors, the best advice for a smooth carefree closing is to allow at least 4 full weeks following subject removal to complete a file. It can be done faster, but the probability of encountering a unavoidable delay or perhaps being forced to extend completion will increase if the “closing window” is tight.
Do you have a deal with a quick closing? Happy to talk about how we can help your clients get it done. Blog post written by Kelowna Real Estate Lawyer Peter Borszcz (250-762-5434)