Legal Question in Real Estate Law in Pennsylvania

Re: Real Estate Law/Settlement Contracts

You asked about entering a realty sales agreement with a 9 month settlement date.

This strikes me as very odd. Why would a seller agree to such a term? What is the buyer's incentive to wait? Does the seller simply want a free place to live for 9 months?

Remember that the sale actually takes place when the agreement to purchase is accepted. The settlement is just the formal closing of that transaction. Legally, equitable title passes on the day the offer is accepted. That means that the buyer assumes risk of loss. It is commonly accepted that the seller must transfer the property in the same condition as on the date of sale but what is the seller's incentive to properly maintain the property? What is the seller's incentive to maintain the best insurance policy rather than just the bare minimum if any?

Such a long settlement has all upside for the seller and only downside for the buyer. Either way, make certain you have a good lawyer review the contract and take the risks of the terms into consideration on the exact terms of sale and especially on the price.

Again, speak with a lawyer no matter which side you are on.

Regards,

Roger

Re: Real Estate Law/Settlement Contracts

Parties may agree to whatever period of time until settlement that they want. That is not illegal. If you do not agree with a 9 months' off settlement date, do not enter into the agreement.