Can closing be delayed if financing is not
ready?
Can your home closing be pushed back if your mortgage isn’t ready? Read this first — it will save your deposit and your move.
Quick answer
Yes — but only if you act fast and follow the rules. In Milton, Ontario, a delayed financing situation is common. You can often postpone closing by agreement. If you don’t handle it right, you risk losing your deposit, being sued for damages, or facing other legal consequences.
This guide tells you what to do the moment financing isn’t ready, the legal realities specific to Milton and Ontario, and the exact steps buyers and sellers should take to protect themselves and keep deals on track.
How closing and financing conditions really work in Ontario (Milton context)
Most purchase agreements in Milton include a financing condition. That condition gives the buyer a set number of days to secure loan approval. If the condition isn’t removed by the deadline, the agreement can become void — unless both parties agree to extend it.
Key facts:
- The buyer must remove the financing condition in writing by the deadline in the offer.
- If the condition is not satisfied and not waived, the agreement usually becomes null and the deposit is returned to the buyer.
- If the condition is waived, the buyer is legally obligated to close on the date in the agreement.
- Many offers include a “time is of the essence” clause. When this clause is present, the closing date becomes strict. Miss that date and the non-performing party can be in immediate breach.
In Milton, local law firms and lenders follow Ontario land registration and funds transfer timelines. That means delays in lender funding, appraisal, or documentation can cascade into missed closings unless everyone agrees to an extension.
If financing isn’t ready on closing day — your options
If financing isn’t ready, here’s what usually happens and what you can do.
1) Ask for an extension (best path if seller agrees)
- The buyer or their lawyer sends an amendment or extension to the seller’s lawyer.
- The seller can accept the extension and sign the amendment. This is the most common outcome when the delay is short and the buyer shows proof of lender progress.
2) Seller enforces the agreement (seller’s risk and remedies)
- Seller can treat the buyer as in default. Remedies include keeping the deposit (if permitted) or seeking damages. In Ontario, remedies depend on the contract terms and whether “time is of the essence” applies.
3) Mutual termination
- If the financing condition was never removed and both parties want out, they can agree to terminate and return the deposit.
4) Short-term financing or bridge loan
- Buyers can pursue bridge financing or alternative lenders to close on time. This often saves the deal but can cost more.
Practical Milton-focused moves to avoid a delay
Stop panicking. Do these steps immediately if you sense financing trouble.
- Call your mortgage broker and lender now. Ask for a firm funding date and escalation to underwriting.
- Provide any outstanding documents immediately (proof of down payment, updated pay stubs, condo docs if applicable).
- Request an extension in writing before closing time. Even an informal message followed by an immediate signed amendment helps.
- Engage your lawyer early and ask them to coordinate with the seller’s lawyer. Local Milton lawyers know how to clear common last-minute hold-ups fast.
- Consider a short bridge loan or a mortgage commitment letter if the lender is delayed but has approved the loan in principle.
- Offer a good-faith increase in deposit or a small penalty payment to the seller for time if needed. That shows you are serious and can persuade the seller to extend.
Local note: Milton lenders rely on appraisal and title work that may require Municipal approvals or condo documents. If the property is in a newer Milton subdivision, confirm builder documents and tax numbers early.
If the seller — what should you do?
Sellers have power when buyers miss financing deadlines. But acting without strategy can lose you a sale.
- Don’t cancel immediately unless you have legal advice. Ask for evidence of lender progress first.
- Request a formal extension amendment with clear new dates and consequences if missed.
- Consider negotiating a non-refundable top-up to the deposit or a rent-back fee for added security.
- If you included “time is of the essence,” remember that courts sometimes require reasonable notice. Get legal advice before taking harsh steps.
Moving and possession logistics in Milton when closing is delayed
Many sellers and buyers confuse closing date with possession date. They may not be the same.
- Confirm the possession date in writing. If closing is delayed, possession usually adjusts too unless the contract says otherwise.
- Movers in Milton book weeks in advance. Call now to move your booking to a flexible window or get a cancellation option with credit.
- Arrange short-term storage or a temporary rental if you can’t move on the original date. Local storage companies in Milton and nearby Oakville/Guelph offer daily rates.
- If you’re the seller and the buyer delays, consider a short rent-back agreement so you can remain in the home and collect compensation.
Pro tip: Many Milton buyers book local moving companies with flexible change policies (ask for a written change clause). This small extra cost avoids major headaches if the closing slips a few days.
Real-life examples seen in Milton deals (what usually happens)
- Scenario A: Buyer’s lender delays appraisal by 48 hours. Buyer’s broker sends proof to seller. Seller signs 3-day extension. Closing happens with no penalties.
- Scenario B: Buyer waived financing but their mortgage final approval stalled. Buyer misses closing. Seller treats as default and retains deposit. Lawsuit avoided because deposit clause was clear.
- Scenario C: Buyer asks for extension and offers a $2,000 non-refundable top-up to the deposit. Seller accepts and the deal closes 7 days later.
These outcomes show the value of communication, goodwill gestures, and quick lawyer involvement.
Checklist: What buyers must have ready before the closing date in Milton
- Final mortgage commitment letter in hand
- Completed home insurance binder ready for lawyer
- Certified funds arranged for closing (ask your lawyer for exact amount)
- Copies of ID for all closing parties
- Municipal tax and utility details for lawyer to confirm
- All lender documents and appraisal cleared
Miss any of these and the risk of delay jumps.
Why local expert direction matters
Milton is busy. New subdivisions, builders, and condo complexes add paperwork. Local lenders and lawyers in Milton know the typical bottlenecks: new home enrolment numbers, condo status certificates, municipal tax roll timing, and common builder documentation delays.
That’s why a local expert who runs deals in Milton every week matters. They know which lenders fund fast, which lawyers clear titles quickly, and which steps normally trip up buyers and sellers.
Final reality: don’t assume a delay is automatic — handle it
If financing isn’t ready, it’s not the end — but it’s also not automatic that you’ll get more time. The outcome depends on the offer terms, the seller’s appetite to cooperate, and the evidence you show.
Act early. Communicate clearly. Use legal counsel. If needed, be willing to pay a bit to keep the deal alive.
If you want a local pro who knows the Milton rhythm, can get lenders to prioritize files, and will keep your move on track — reach out.
Contact: Tony Sousa, Milton real estate expert. Email: tony@sousasells.ca | Phone: 416-477-2620 | https://www.sousasells.ca
FAQ — Milton closing delays and moving logistics
Q: Can a buyer extend the closing date unilaterally if their mortgage isn’t ready?
A: No. Extensions require the seller’s agreement. Unilateral changes can be treated as breach.
Q: What if the financing condition wasn’t removed by the deadline?
A: If it wasn’t removed, and no extension is agreed, the agreement can become null and void and the deposit returned to the buyer.
Q: What does “time is of the essence” mean for closing dates in Ontario?
A: It makes the closing date strict. Failure to close on time can be grounds for immediate breach. Consult your lawyer before assuming leniency.
Q: Can a seller keep the deposit if the buyer misses closing due to financing?
A: Possibly — if the contract allows forfeiture and the seller treats the buyer as in breach. Legal advice is essential.
Q: How long can closing be delayed in practice?
A: Typically a few days to a couple of weeks. Longer delays need contract amendments and may trigger other conditions (financing rates, taxes, occupancy).
Q: Should I book movers before financing is final?
A: Yes — but book flexible options or refundable deposits. Choose movers who allow date changes.
Q: What’s a good alternative if my bank funding is delayed?
A: Short-term bridge loans, private lenders, or a mortgage commitment from another lender. Each has trade-offs; consult a broker.
Q: Who coordinates the legal side of a delayed closing?
A: Your real estate lawyer. In Milton, experienced local lawyers will communicate with the seller’s lawyer to draft extensions and confirm new dates.
Q: Does possession always move with the closing date?
A: Usually, yes — possession typically follows closing unless the contract specifies otherwise.
Q: How can a seller get security if they agree to an extension?
A: Ask for an increased deposit, a non-refundable top-up, or a short-term compensation amount for delayed closing.
If you are in Milton and worried about a closing delay, get local experience on your side. I work with lenders, brokers, and Milton legal teams to keep closings on track. Contact Tony Sousa for honest, practical help: tony@sousasells.ca | 416-477-2620
