You may wonder what I'm talking about when I refer to "Counting Days" but it's an interesting topic which has caused a lot of confusion in the real estate world.
Here is an overview:
Calendar days are just that....each day on the calendar.
Business days are usually referenced as Monday through Friday except when there is an official holiday.
We use business days whenever we have financial events that require a deposit of funds. Monday through Friday except when there is a federal holiday. If the contract says funds are due on day 3 but day 3 falls on a Sunday....funds will be due on Monday.
We start counting days the first calendar day AFTER the date of acceptance
Due dates and expirations are extended to the first business day if they fall on the weekend or holiday
The day ends at 11:59pm
Here is an example:
Once we get an accepted contract, we start counting days to clearly define contingency periods, close of escrow and other contractual obligations.
Day 1 begins the first day after a contract has been accepted regardless of when during that day you accepted the contract. Let's say contract is signed at 12:00pm on January 1, first day begins the following morning on January 2.
If a contingency is due in 7 days, January 8th is the marker but because it falls on a Sunday, the due date is moved to the next business day which is January 9th
Is this really important? Yes, indeed! Each party has the right to issue a Notice to Perform and if the affected party does not perform by the deadline, cancellation is an option. Understanding deadlines is essential to performance so having a timeline will help you stay on track.