I am often asked this question by my clients who are either buying or selling a home, cooperative apartment or condominium unit. The standard residential contract of sale used by attorneys in the New York Metropolitan area will state that the closing will take place, for example, “on or about October 1, 2016.” The phrase “on or about” has been interpreted by the New York courts to mean that either side has a reasonable period beyond the “on or about” date in which to close. While the courts are silent as to what constitutes a “reasonable” time, almost all real estate attorneys practicing in the New York Metropolitan area have come to a consensus that reasonable is 30 days.
If a party is unwilling to close within that 30 day period the attorney for the party wishing to close can send what is referred to as a “time is of the essence” letter to the other party. That letter will set forth a new closing date, usually 10 days after the expiration of the 30 day period, stating that “Time is of the Essence.” If the party receiving the letter does not close by that date they can be declared in default under the terms of the contract of sale.
When signing a contract as a seller or buyer, be sure you communicate to your attorney your desired time frame so as to not run up against deadlines in the contract which could cause you to default.
