Arizona Close of Escrow
Close of escrow is defined as recordation of the Deed from the Seller to the Buyer. Once recordation occurs, the Buyer becomes the legal owner of the property, and the Seller’s rights of ownership are terminated.
The close of escrow date is written in the purchase contract and is agreed upon by the Buyer and Seller.
Since no one knows the exact hour of the business day when close of escrow (recordation) will occur, it is advisable Seller’s vacate the premises one day in advance of the date specified in the purchase contract, unless negotiated in advance that the Buyer’s possession (not the same as ownership) will be at a different time.
When the Seller of real property cannot deliver “possession” to the Buyer at close of escrow, the parties can enter into an agreement for post possession during the contract negotiation process. Although post possession delays the process of occupancy by the Buyer (et al.) it does not delay ownership.
Since the Buyer technically owns the property at closing, the Seller becomes a tenant. This option usually requires a per diem payment of rent and a security deposit, refunded in part or in full at the time the Seller vacates the premises - if left in the same condition as on the date of recordation.
Pre-possession occurs when the Seller allows the Buyer to “move-in” prior to close of escrow. As such the Buyer becomes a tenant until the date of closing. A security deposit and per diem payment of rent is usually negotiated.
*Since these contract writings endeavor to create a Landlord/Tenant relationship albeit short term, they will likely require a court eviction proceeding in the event a breach of contract occurs.