Westcoe Realtors, Riverside Ca…This is a pretty common question in our business, and one of those “little” details that can really cause a mess if everyone is not on the same page. Therefore, in order to prevent a melt-down by either the seller or the buyer, maybe we can set the record straight here before the tension level rises.
When the buyer makes their offer to purchase, paragraph 9 of the Standard Residential Purchase agreement addresses pretty much all the possibilities that can pertain to the buyers possession of the property. So…if you are currently having a problem with this issue, start there first.
Without getting massively technical here, let us offer a few common scenarios below that might help with understanding definitive possession dates.
First…if the house is vacant, then most of the time, in reality, nobody cares when the buyer moves in, so normally the keys are given to the buyer the day escrow closes. No fuss, no muss, no coordinating between the buyer and the seller. Just move in and there you have it. Technically, there is a place in paragraph 9 that spells out the time the buyer can have the keys (the default time is 6:00 pm, but that can be changed when the buyer presents the offer), but again…who cares? The house is vacant.
Next, lets discuss what happens when a seller is in the home…which is most of the time. What happens then?
Well, again paragraph 9 allows for some options here. When the buyer makes the offer, they can request that possession be the date escrow closes, but this is rarely done since that would mean the seller basically had to have most of the move completed before they knew for sure escrow would close. Most sellers will balk at this, since there are numerous horror stories about buyers bailing out of an escrow at the last minute. So…most sellers want to know for sure that the purchase has closed before they actually vacate the home.
Next, the buyer can give the sellers _____ days (fill in a number) to leave, and typically this is 3 days. Sometimes it is more, sometimes less, but in a huge percentage of sales, it is 3 days. So…just what does that mean?
It means that the seller gets close of escrow plus 3 days to move, with the buyer able to take possession at 6:00 pm on the 4th day if the default time of day is used. This is where most of the confusion occurs. The seller gets close of escrow (day 1) plus 3 days, making a total of 4 days. Many buyers only hear the “3 day” part of the equation, and schedule the movers to arrive on the 3rd day…a full day early. As you can imagine, this can cause some major headaches…headaches that are totally avoidable with some good communication between all parties. Your Realtor should have arranged all this for you, and made sure everyone is in agreement…so check with them before doing too much scheduling.
What happens if the seller needs more time to move?
Well…hopefully they knew this when they accepted the buyers offer and made the longer possession time part of their acceptance. Sometimes the seller has some circumstance that may require a longer time after escrow closes to move. It could be the home they are moving to is occupied and the seller has to wait for those sellers to move before they can move (quite common), or there is a job situation that requires more time, or a family issue, or who knows what. The possibilities are endless, but the important thing is that the seller has told the buyer about this when they accepted the buyers offer. If this is the case, then there is a form that the seller needs to fill out regarding the extended time they are asking for, and there would perhaps be some rent involved, since the buyers payment starts on the day escrow closes.
Again, there are a million options here, and everything goes better when this is all addressed in the offer to purchase, and not a week before escrow closes.
Lastly, what if the seller simply won’t move when they are supposed too? We suggest you read our blog post of June 17, 2015 (What can the buyer do if the seller refuses to move out), and then call your agent…immediately!
The moral of our story here is that possession agreements are best made in the beginning, so everyone can plan accordingly…because while moving is stressful enough, it’s even worse when there are two moving vans, one driveway, and some really hot buyers and sellers yelling at each other!
Take care, and as always, thanks for reading our blog…and don’t hesitate to contact us if there is any aspect of real estate you might like to see us address here.