Yes, there is a day you should avoid…May 31st. In fact, I rarely recommend an end of the month settlement… in any month…because there is no real monetary benefit. There is one exception.
If you are short of cash, it is better to settle at the end of the month because you’ll need less cash at closing. Let me explain:
If you settle on Friday, February 28, your closing costs will include a pro-rata mortgage payment (not including principal) for the last few days of the month, as well as a pro rata share of property taxes, any HOA fees, etc. Your first mortgage payment would then be due on April 1 for the month of March.
However, if you settle on the following Friday, March 7, your closing costs will include a much larger pro-rata mortgage, tax and HOA payment for 25 days as opposed to only 3 so you will need that much more money at closing. However, your first mortgage payment would not be until May 1, as opposed to April 1 in the above scenario.
So you see, it all works out the same, it is just a question of whether coming up with cash at closing is an issue for you.
Check out this article and you’ll learn the “glitches” that can occur at an end of the month Settlement. It can cost more money in the long run if your Closing is delayed due to a scheduling backlog.
As always, never hesitate to call me with your real estate questions!
Jeanette DiLuco, REALTOR® ABR, SFR
Your Partner in Success!
Keller Williams Mainline Realty
720 W. Lancaster Ave. Bryn Mawr, PA19010
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