Are simultaneous closings illegal? (nt) - Posted by R. Texas

Posted by Russ Sims on March 02, 2000 at 12:35:45:

Hi Maggie:
I can certainly understand the confusion, because I’ve grappled with it myself. In a simul. close you actually do take title to the property before it is transfered to your buyer. So you are legally selling something that you rightfully own. The original seller waits the minutes or hours to receive his funds until your transaction with your buyer is complete. This is called a “dry close”. Actually, my title company tells me it’s not uncommon at all for sellers to have to wait to receive their funds, as bank transfers and title checks often force a delay of up to 24 hrs. anyway. Hope this helps.

Are simultaneous closings illegal? (nt) - Posted by R. Texas

Posted by R. Texas on March 02, 2000 at 10:26:53:


Re: Are simultaneous closings illegal? (nt) - Posted by RolloTape

Posted by RolloTape on March 02, 2000 at 11:46:17:

Far be it from me to talk in legalese; however, I believe that NEARLY every closing is a simultaneous close. (I say nearly because a buyer might actually come to the closing table with cash.) Consider this: the buyer comes to the closing table and there is a sale of another property involved, such as the sale of the buyer’s present/former residence to come up with the cash to buy the new property (see the problem). To overcome this (and I am not a lawyer) I believe the law treats all transactions that happen at the closing table to be considered as happening simultaneously. Time is suspended. (I wish it was like this in real life.) If I am wrong, would someone with more knowledge please correct me.

Re: Are simultaneous closings illegal? (nt) - Posted by Russ Sims

Posted by Russ Sims on March 02, 2000 at 10:50:04:

If they were, thousands of investors would be out of business, or at least have a tougher road to hoe. At it’s simplest, a simultaneous close is nothing more than 2 legal real estate closings done back to back. Buy from seller, sell to buyer. The fact that minutes seperate the closing, rather than hours or days, does not make them illegal.

Sequence of sale? - Posted by Maggie

Posted by Maggie on March 02, 2000 at 11:27:17:

Russ, I have a question. I’m just beginning this learining process and continue stumbling on simultaneous closings. Is it accurate that you (I) are funding your purchase from the seller with your buyer’s funds? I think I understand that your buyer deposits his money into an account with the title company who then distributes the funds to the seller and the remainder to you. Is that correct? If so, isn’t that sort of a reverse transaction? You are selling something you don’t yet have, but will in a matter of minutes. Do you see how I lose myself?