If a sale contract indicates that the day of closing is 'the seller's day,' this means that

If a sale contract indicates that the day of closing is 'the seller's day,' this means that

• A. the seller must pay prorated expenses inclusive of the day of closing.
• B. the buyer must pay all closing costs regardless of the day.
• C. the seller is exempt from prorations on the closing date.
• D. the closing date has no effect on prorations.

Answer: (A)

When the closing day is designated as the seller’s day, ownership transfers at closing and the seller remains responsible for expenses that accrue up to and including that day. Prorations are used to fairly divide ongoing costs between the parties, so any daily or period-based charges—such as property taxes, HOA dues, utilities, and similar items—are calculated for the portion of the period up to and including the closing date. The seller handles those costs on closing, and after closing the buyer starts owning the property and takes on costs from the next day forward. This is why the correct understanding is that the seller pays prorated expenses inclusive of the closing day. The other statements don’t fit because they misstate who bears prorations or deny the impact of the closing date on these calculations.

When the closing day is designated as the seller’s day, ownership transfers at closing and the seller remains responsible for expenses that accrue up to and including that day. Prorations are used to fairly divide ongoing costs between the parties, so any daily or period-based charges—such as property taxes, HOA dues, utilities, and similar items—are calculated for the portion of the period up to and including the closing date. The seller handles those costs on closing, and after closing the buyer starts owning the property and takes on costs from the next day forward. This is why the correct understanding is that the seller pays prorated expenses inclusive of the closing day. The other statements don’t fit because they misstate who bears prorations or deny the impact of the closing date on these calculations.