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Procession date weeks after closing date?

Seller want to have procession date a couple of weeks after closing date, or they said rent it back too them for $0 rent for a couple of weeks. They didn't tell us any specific details on why they chose to do so. I only know the seller family is building a new home or moving to a nearby town. Any thought, any risk I should be aware of? 


Thanks in advance.
  • October 07 2013 - Boulder
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Answers (5)

I can understand your frustration.  When you first asked the question earlier this month several others warned against a rent back.

I can understand the emotional upheaval on the sellers side as well.  Certainly they must have had some indication their relative was "not in a good way" before.

So are you willing to continue to put your life on hold?  Waiting until the first week of December barely gives you time to get settled before Christmas.
  • October 26 2013
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We finally set the closing date and possession date the same but three weeks after the major object date. Initially the seller said they need time to remodel their new house which had been closed back in June, then just today, through the agent, we just know that they have a grand parent head to the end of life, and they want to have the last Thanksgiving in the old house, "they have terrible disease", and would like to extend another week way into early December. 

I felt unformed when they want to extend the dates several times during the negotiation. and I now also feel bad the seller put us in this situation. At one side, I am sorry this is happening to their family, at the other side, I don't comprehend fully why this would block them from moving earlier into their newly modeled house.

Confused.
  • October 25 2013
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I would change the closing date.   No way in (bad word) would I rent back.

However, if you are a nicer person than I, make sure EVERYTHING is in writing in a legal contract and do the following: 

Hold back 20% of the payment of your new home in escrow until they are out and there is a satisfactory walk through.

Withhold agent commissions until the sellers are out.

Have them pay double your  mortgage/insurance costs for the time they remain in the house.

Have them pay any incidental expenses you have for delaying closing or moving.

Make sure they have renter's insurance (including liability insurance) for the period.  See the copy of the paid for contract before closing.

If they aren't out in 30 days, institute eviction proceedings so that it doesn't make it to 60 days because at that point lenders expect you to have taken up residence in the home.

  • October 08 2013
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Yes, there are tons of risk.  While most people think it is harmless, it is not.  Once you close on the home you are the owner and you have become a landlord.  Immediately that changes important things like your mortgage and insurance.  Also, why would you let them live there for $0 unless you are paying a really low price for the home?  Your mortgage company is not going to let you pay $0 while you wait for them to move.

Finally, what if the home burns down? What if a pipe breaks? You will be responsible. What if their new home is delayed, will you kick them out?

I know people want to keep real estate transactions friendly, but it is a business agreement.  You are far better off to delay your closing until they are ready to move or they give significant contributions that offset the risk and cost to you.
  • October 08 2013
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Typically I get a post occupancy agreement signed with the purchase agreement stating liability and insurance, you can find the form in the standard forms. If it goes over two or three weeks I look at a rent back situation, it just depends on where my sellers are with their move.

Hope this helps!
  • October 08 2013
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