Made an offer... (sale, real estate, renters)

[nc_eagles_fan]

We made an offer on a FSBO home and the owner has countered asking to rent back after closing.

How would something like this work? How much is a fair amount to rent for? Is there a particular form I should use to make it official, or just write on the offer the rent particulars?

Thanks for your help!

[MikeJaquish]

Have your attorney draft or review the agreement.
"Rent back" sounds innocuous enough, but unfortunately, stuff happens.
If you get in a position where you have to evict, you need to have a clear, legal lease.

[HOltmans]

We did this with our last house we sold - we closed in April but could not move out until the end of July, so we rented it from the new buyer for the amount of his new mortgage payments (which turned out to be less than ours, so we were happy). Also, when I bought my first townhouse I rented it back to the sellers for a couple weeks for just $1. (got a great deal on the house so I felt generous!) It's all up to the sellers and buyers to come to an agreement on the price and it can be negotiated along with everything else. But I do agree it should be in writing on the contract!

Good luck!

[MaimounaKande]

We did this too when we bought. The selllers rented back from us for a month or so for the amount of our mortgage (and of course continued to pay utilities) while they waited to close on their new place.

It's pretty standard so any real estate lawyer should have a form for it. Our said that it must be in teh same condition it was in during the walk-through just before the sale and that they would be responsible for any damage if it wasn't.

The poster who said seh rented back for $1..if you are thinking of being really nice, be sure to do what she did. If you rent back (even for $1) they are officially renters and can be held repsonisble for damages. If you say "sure, stay for free for a few days" and they destroy something, you are not protected. That's what we were told anyway!

[Tracy_Santrock]

Originally Posted by nc_eagles_fan

We made an offer on a FSBO home and the owner has countered asking to rent back after closing.

How would something like this work? How much is a fair amount to rent for? Is there a particular form I should use to make it official, or just write on the offer the rent particulars?

Thanks for your help!

It depends on how long you need to rent back. If its more than 10 days you will need to use the standard North Carolina lease agreement. That said, you can even save the attorney's fee for drafting up "custom verbage".

Generally, as others have noted, you prorate the rent on a daily basis based on the mortgage rate or "typical" rental rate in your neighborhood(if there are any).

I've done this several times for clients and it works out well, especially for investors.

[Erin1264]

We also did this. The document is a "possession after closing" document and it includes terms for rent.

We were not ready to move yet, and the sellers hadn't found another home yet, so they rented from us after we closed. It worked out great even though it was several months.

[NCHomeFinder]

Sellers renting back is common for the reasons already stated, and can be handled with some standard forms. Since you're not using a realtor to go over the standard forms with you, I would recommend having your closing attorney look over any lease agreement.

On the flip side, I do caution sellers strongly about allowing a buyer to rent BEFORE closing. For the same reason Mike stated, evicting someone can be hard enough if things go wrong, but if for whatever reason they can't close on the house, if you have to evict, you also will have a tough time showing the property to new potential buyers. There are plenty of places that do short term leases for buyers. That doesn't mean don't do it in any situation, but just be aware of the potential headache.

[PDXmom]

Our first home we did a rent back to the seller, but we both used realtors. It was a smooth transaction. The seller even had the house professionally clean when they moved out! We charged them the amount our mortgage based on the number of days they were there.

I do have a friend whose ex-hubby (an attorney) was able to get both the mortgage and taxes from the seller who wanted to rent back. His arguement was he could not move out of his current home and stop paying taxes until he could move into his new home. He had a buyer for the old home lined up and waiting on him to move. But this was 20 years ago and I think real estate was less regulated then. And this guy is a pretty slick talker.... thus why my friend is no longer married to him. I can't imagine this would fly today, even if you were paying taxes on 2 places.

OH, another thought... ask the FSBO seller for a Home Warranty. If something breaks while they are there then maybe this would cover it.

Good luck!