Send Me A Message Got any questions? Get in touch

    Main Content

    Funny Story (or NOT) on way to Closing table

    Things happen. Some that we can’t control. What is the risk of having a post possession agreement?

    A: A post possession agreement states that upon closing the seller will not vacate the property and will “rent” from the new homeowner for a stated period of time. Generally this is for about a week for the seller to move out. Sometimes it can be a month or longer for example if the seller is building new construction and the house won’t be ready. In this strong seller’s market, many buyers are flexible with the possession date.

    How this rent situation plays out though adds another level of risk. Like what? Well the buyer needs to do 2 walkthroughs. They will come through the day prior to closing to ensure “a tree didn’t hit the house” situation. What they are able to view is limited since the seller likely has moving boxes and hasn’t vacated yet. Once the seller has moved out before giving over the keys, the buyer would come through again. If everything checks out ok then the escrow money will be released back to the seller, minus the prorated days of rent.

    But what happens when something goes wrong? What if the toilet gets stopped up and causes a leak on the 2nd floor with water damage? Yeah… that happened. It became a major headache for the seller to negotiate with the buyer and the moving company in order for the escrow funds to be released. As it turns out, this was a Funny (but NOT) so funny story on the way to the closing table. ugh…

     

    Join

    Caroline’s VIP List

    For exclusive news and market updates, contact us through the form below.