The completion, possession and adjustment date is crucial to keep track of when buying or selling a home. But they often get confused. Here’s a breakdown of what each date represents and why making these on your calendar is so important. The three dates will be negotiated into your purchase agreement. Typically the completion happens first, followed by the possession and adjustment. However, having these dates in a different order is possible but not very common. The process of the completion of the purchase/sale is also called closing.
Completion
On the completion date, money changes hands in a home purchase and sale, and the transaction is “completed.” This is when you finalize your registration paperwork with your lawyer or notary and become the new legal owner. The previous owner’s name will come off the land title, and the new owner’s name will go on. The buyer pays for the property, and the seller receives their payment. BC REALTORS® use a standard contract created by the British Columbia Real Estate Council, The contract specifies Buyers assume all risks for the property at 12:01 am as of the completion date. The completion date is the day you’ll set up home insurance; even if you’re not moving in right away, you are the legal owner.
In the “old days,” and by old, I mean the early 2000’s completion was done with paper at the New Westminster Land Titles Office. So it was possible you might not register in time to meet the completion date, and we’d always need to leave a few extra days’ leeway before releasing keys. The process is more streamlined today with digital land title registration, but it’s not instantaneous. There are several steps your lawyer or notary takes to ensure funds are secured before completing the registration. This typically takes several hours. We usually see the registration notice close to the end of business (4 or 5 pm) on the completion date. The seller may not receive their fund until the following day. For this reason, most sellers would give out the keys at the earliest the day after completion.
Possession
The possession date is when you “get possession” of your new home. You’ll receive the keys and move in on your possession day. You’ve already become the legal owner on your completion date. Now it’s time to make your new house a home. You’ll have negotiated a possession date during the offer process. Once you’ve agreed to a possession date, this is a fixed date. Even if you sign all the completion documents weeks in advance, you’re not entitled to the keys any earlier.
Traditionally completion and possession dates are usually set apart by two or three days to accommodate home sellers. This way the seller moves out and into their new place before giving the buyers the keys to move in. While it sounds convenient for buyers to get keys as soon as they sign their completion certificate. In practice, the seller often depends on a set-apart possession date to make their move possible. In addition, not all sellers qualify for a bridge loan or have funds to store everything and book a hotel.
Adjustment
The adjustment date is the day property-related bills are split up and “adjusted.” Property taxes, utilities, sewer/water, garbage/recycling, strata fees, and tenant rent will be divided. Each bill will be pro-rated based on the number of days a home belongs to the Buyer vs the seller. The adjustment date usually aligns with the possession date, but it could align with the completion date instead or, depending on the situation, be a different date altogether.
Although completion, possession, and adjustment dates are all necessary, they’re often confused. Therefore, it’s best to remember the different dates and their meaning. For example, when you’re setting up insurance, you need the completion date; when you’re booking movers, you need the possession date; and when calculating utility accounts, you need the adjustment date.
