Concurrent Closings: Selling & Buying a Home at the Same Time
Getting ready to move and buy a new home? Congratulations! If you’re trying to navigate selling one home and buying another at the same time, you may face a concurrent closing. We’ll walk you through the basics of what that means and how to do it successfully.
What is a Concurrent Closing?
A concurrent closing means you sell one home and buy another quickly — sometimes even on the same day.
Most people prefer a concurrent closing because they must sell their old house before closing on the new one. Often, people use proceeds from the sale of the old home for the downpayment on the new one. Also, some mortgage lenders require the sale of the first property to qualify for the new mortgage.
Did you know: Concurrent closings cannot actually happen at the same time. You have to complete the first closing before the next can happen, so a couple of hours (bare minimum) is needed between them.
What are Double Closings?
A double closing is similar to a concurrent closing but involves an intermediary or investor who uses the proceeds from the second closing to fund the first closing. Both closings are done in escrow so the middleman/investor can buy and resell a property for profit without using their own cash.
Some people use this method for house flipping. However, some title and escrow companies will no longer do a double closing because of the possibility of loan fraud.
What about Simultaneous Closings?
The term “Simultaneous closing” is a generic phrase used interchangeably for concurrent and double closings. Remember, neither type of closing has the two closing transactions happening simultaneously.
How to Sell and Buy a House at the Same Time
There are two main obstacles to navigate for a successful concurrent closing:
- Ensuring both closings happen smoothly (especially the first)
- Bridging the displacement gap for you and your possessions
The risk of trying to do two closings quickly is that many things can go wrong to delay one or both closings. If your first closing is delayed, it almost always means delays for the second one.
Closing delays can result from paperwork errors, last-minute requests for additional paperwork, and funding delays.
The key to a smooth process is communication and organization:
- Triple-check every detail
- Review your paperwork in advance
- Communicate with your closing agent, mortgage broker, and loan officer to ensure everything is set.
Then, on closing day, grab everything you need and arrive early.
Pro-tip: Schedule both closings a few days apart if you can. That way even if anything does go wrong you have some time to fix it. Avoid the last week of the month, when title companies are usually very busy.
How to Bridge the Displacement Gap
When you are selling one home and buying another, there is no overlap of ownership, creating the question of when you will move. This means coordinating move-out dates for both properties and where you and your possessions will reside in the transition.
There are two ways you can handle this situation:
- Take a short-term lease on your old house after closing
- Stay at a hotel or with family between closings
Work out a deal with the new owners of your old home to lease the property to you for a short amount of time while you pack, clean, and move out. However, if your buyers are also selling a home (or vacating a rental) and need to move too, this option probably won’t fly.
Option #2 (More Common)
Also called a double move, this involves staying in a hotel or with friends or family until your new home is ready. Sometimes, you can negotiate storing your possessions at one of the two homes during this time, but using a short-term storage solution is more likely.
Using the same company for storage and moving services will help make the process seamless and far less stressful.
How Long Does Closing on a House Take?
On average, closing on a house takes 30-50 days unless something comes up, which can happen. Then, on closing day, you can expect to spend 1-2 hours working on paperwork, especially when you’re the buyer.
You don’t want to rush this process, so plan to take the morning or afternoon off of work to complete this process. It’s also a good idea to avoid closing on a Friday in case something goes wrong.
How Long After Closing Can You Move In?
This answer depends entirely on the terms of the contract you sign. Sometimes, you’ll be able to move in immediately following your appointment. Other times, the seller may request they stay in their home for 1-2 months after closing.
Pro-tip: Know your closing terms before hiring a moving company. You don’t want to coordinate all those logistics only to find out you cannot move in immediately.
Still Have Questions?
If you’re buying and selling a house at the same time, the process can be a little more complicated and stressful, but it is possible — and worth it! After all the runaround, you want to get into your new home smoothly and without hassle. That’s where we come in!
AAA Movers has served Minnesota, Illinois, and beyond for over 50 years. If you’re considering a move, check out our services and get a free moving quote. Our certified moving professionals are ready to help you get into your new home without stress or frustration. And don’t forget to check out our storage solutions.
Questions? Contact our team; we’re happy to help!