Expenses are prorated through the closing date, so generally, there’s no better day of the month to close. However, in financing a mortgage, there are differences in what is collected as a prepaid item and when the first mortgage payment is due.
Some advice and tips:
Give yourself enough time. Don’t set a short closing date unless you’re paying cash. There are many steps involved with a home purchase, and the loan process takes time. A short closing date might predate final loan approval. If possible, avoid closing at the end of the month. This is the busiest time. Title officers and lenders are readily available to deal with unexpected issues. Could you align your closing with the move from your old residence to your new house? Ideally, your move should be from one to the other without a hotel stop in between. Could you arrange with your local utility companies to ensure they can start service on the closing date? Living without water, heat, air conditioning, or Wi-Fi until they are activated is unnecessary—not to mention unpleasant. Mortgage payments are almost always due on the first day of the month, and the fee is due for the preceding month. For example, if you close in July, your first payment is due on the 1st of September. However, interest is due for July from the date of closing. If you close early in the month, say on the 10th, you would have to pay for 21 days, but if you close on the 25th, you would have to pay six days of interest. If money is tight, closing toward the end of the month will reduce your immediate out-of- pocket expenses. There are consequences if you schedule a closing and fail to complete it on that day. You’ll face increased closing costs the next month, in addition to any penalty for the delay. Although most sellers will work with you if the transaction does not close
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