Why Seller's should try to avoid temporary lease backs
When you list your house, you will be confronted with plenty of decisions to make at negotiations. One of those decisions which may occur is whether to lease your home to the buyer while they settle their loan. Below are some of the reasons this is not a good idea.
1) Loan's are usually not completely approved until closing
Sometimes the approval comes in right at closing, or maybe a few days before closing. How to sell a house 101 courses would state to never count the closing as completely done until after closing and funding. Even if there is little risk, there is always a risk big enough to consider the undoing of the loan.
2) Buyers and Tenants have different rules of engagement
As a seller, there are federal and state regulations on how to act in a sale transaction. Then there is regulations on how to interact as a Landlord to a Tenant. For that brief period of lease, these property codes may still apply. Make sure you acquaint yourself with them before you agree to the transaction.
3) Once in possession, you must Writ of Possession
Listing Agent Houston and Listing Agent Dallas would recommend to be careful with your lease back for this sole reason alone. Read the definition of Writ of Possession here, and you can see why it may be difficult to evict a buyer who has legally occupied the home. Overall, it may cost to evict the buyers/tenants from the home.
As your low commission realtor solution, we are here to get you to save and close when you list your home. Temporary lease backs are very sticky, but sometimes unavoidable. It is something we do not recommend, but contact us if you have any further questions on having to do one.
Will Puente, MBA