Post-possession...Do I need it? Do they?

The cleanest (pun intended) of transactions is when a newly built home is handed to an excited first time home buyer.

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In the real world, however, this is rarely the case. Negotiating and arranging a sale, purchase, and transfer of possession usually involves a lot of moving parts. The seller has to leave, usually with the money to pay for their new house. The buyer has to move in, sometimes on the day of the closing. All of this might seem impossible.

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One solution can be a post-possession agreement. This means the buyer allows the seller to stay for a few days or weeks after the closing, usually with a per diem (daily rent) negotiated in advance. Often, the buyer will negotiate increasingly punitive daily fees, to help ensure the seller leaves when they initially intend to. Having an attorney hold some $$$ in escrow can help ensure everyone meets their obligations.

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Lawyers don't like this, because it means a transaction that appears "over," now has a tail. For example, what if the upstairs shower leaks and there is water damage during the post-possession period? No fun.

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Understanding these risks, this can still be an effective way to provide buyers and sellers a little cushion on move-in and move-out dates. I recommend evaluating the level of trust built between the parties when deciding whether to take this course. If the people across the table have been dishonesst, petty, or selfish, don't assume that will stop after the closing.

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Tread lightly. And as always, talk to your realtor!

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kennythecloser.net

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