To Buy and Sell on the Same Day… That Is the Question

Congratulations, your offer to purchase a new home has been accepted! The next step: selling your current property and determining your ideal closing dates. Should you align your purchase and sale to close on the same day, or schedule staggered transactions?

This is a common dilemma. Coordinating the closing dates for two interdependent real estate transactions raises important logistical and legal considerations. Below, we break down the benefits, risks, and practical alternatives to help you make an informed decision.

The Case for Same-Day Closings

For those who thrive on efficiency, a same-day closing can be appealing. It eliminates the need for interim financing, allows you to move directly from one home to the next, and wraps both deals in a single-day package.

In an ideal scenario, ie. where all funds are received and processed before the 6:00 p.m. contractual deadline (or even better, by 5:00 p.m. when the Land Registry Office closes), everything can be finalized seamlessly.

With an experienced team of professionals coordinating the details, a same-day closing can work. But it requires more than good planning. It also takes a fair bit of luck.

The Risks and Realities of Same-Day Closings

Unfortunately, same-day closings are unpredictable by nature.

To complete your purchase, your sale must close first. This means the buyer of your current home must provide funds early enough in the day for you to receive sale proceeds and use them to complete your purchase. If they are also closing a sale the same day, or if their lender is delayed in releasing funds, your timeline could be immediately impacted.

Delays can also result from:

• Wire transfer processing times, which vary depending on the financial institution involved;

• Title clearance issues that arise late in the day;

• A chain of buyers and sellers, each relying on the successful completion of the previous deal in the sequence.

In these situations, there is limited time on the day of closing to respond efficiently and the cost implications can escalate quickly.

You may face:

• Extension fees payable to other parties in the chain;

• Additional legal fees for rush arrangements and amendments;

• Overage or storage fees from your movers if possession is delayed;

• Temporary accommodation costs, such as a hotel stay if you cannot access your new home;

• The risk of default, if you are unable to close on time.

At best, a same-day closing is the least expensive option: no bridge financing, no need to store your belongings, no gap between homes. But at worst, it can become the most expensive option by far. There are no guarantees.

And the most important takeaway: you may not know the true cost of your closing until the very day it happens. Delayed funds, domino effects from other closings, title or banking issues, any of these can throw a wrench into the day’s plan, and with very little time to react cost-effectively.

That uncertainty alone is reason enough to consider alternatives.

Viable Alternatives

If you’re looking for more control, less stress, and predictable costs, consider these options:

1. Bridge FinancingA short-term loan that allows you to access the equity in your current home before it sells, bridge financing enables you to close on your purchase first and move at your own pace. Many clients find the cost (typically a few hundred dollars to a thousand or two in bank and legal charges) well worth the added flexibility and peace of mind.

2. Sell First, Then BuyThis approach guarantees that your sale proceeds are in hand before you commit to your purchase. Even with a short delay between transactions, you can plan around it — store your items in a truck or storage unit, stay with friends or family, or book a hotel stay to break up the move.

Know Before You Commit

Understanding the risks, and your obligations, is critical. What happens if you can’t close on time? What are you liable for? What does it mean to be in default under your Agreement of Purchase and Sale?

We recently handled a transaction where everything was lined up for a smooth same-day closing… until the movers miscalculated how much needed to be packed and transported. Despite the sellers’ best efforts, the property couldn’t be cleared in time. This not only resulted in significant additional moving costs, but also required the sellers to pay compensation to the buyers for the items that ultimately could not be moved and pay additional legal fees. It’s a strong reminder that even with good planning, things outside your control, like a moving company’s underestimation, can lead to real financial consequences and unnecessary stress for you.

A conversation with your lawyer early in the process can help you evaluate the risks and choose the most appropriate structure for your sale and purchase. And on closing day, staying available for communication is key: it allows your legal team to deal with last-minute developments as efficiently as possible.

Our Advice

At Junction Law Professional Corporation, we have extensive experience with same-day closings and are always happy to walk you through what to expect. But in most cases, where it can be avoided, we recommend against buying and selling on the same day.

Planning for a smoother transition and a more predictable cost is almost always worth it.