Tuesday, October 03, 2006

Don't Let em Move in Early

As the real estate market cools, it appears that buyers are asking more and more of sellers. Anxious sellers, hoping to make a deal, often oblige. One thing I have noticed Buyers requesting more often is occupancy prior to closing. While this practice is common and can be beneficial for both parties, I highly recommend not to lease your home prior to closing. Here's why:

  • The NWMLS forms for Leasing and Occupancy Prior to Closing are not written as well as many long term leases. I believe they are too general and do not protect the buyer or seller well.
  • A deal's not done until the Escrow lady sings. In other words, deals fall apart all the time, sometimes even on the day of closing.
  • If the deal falls through you may have a hard time getting the buyers out, especially if the buyers feel that it wasn't their fault.
  • Washington is one of the worst states in the US to be a landlord. Tenants can squat for weeks or even months during the eviction process.
  • After the deal falls through, you may be left without real estate agency. Many agency agreements dissolve after the closing date has passed. This may leave you to deal directly with the buyers or force you to hire a lawyer.
  • Unless rent was collected upfront, then you may be left with zip. These days, its almost a given that buyers get their earnest money back.

There are many leases prior to closing that go well, but there are some that end up going dreadfully wrong. My advice - play it safe, leave it vacant.

1 comment:

Paul Fleetwood said...

Great Article. Thanks for the insight.