Occasionally it's useful to sell your home before you truly want to move. This typically happens when you are having a new home constructed, but aren't sure of the completion date. Is there any way you can sell your house so you're sure of the funds offered for the new purchase, however remain to live in your old your home till building of the new one is full. Yes, there is with the renting back strategy.
Enter the Lease-Back or Rent-Back Agreement
The details of this method vary from state to state, however in the strong seller's market we're experiencing, buyers will frequently accept let the seller stay in the house for a time frame as long as rent is paid. In a competitive scenario, the buyer willing to do this will often have the gaining proposal despite the fact that there is another offer as high as his.
The contract covering the circumstance mentions the length of time the seller will continue to be. It can be finished with a specific date named or wording that allows the seller to stay up to a specific date with the possibility of her relocating earlier. The quantity can be a fixed figure paid of the proceeds of settlement or a regular monthly amount, or a day-to-day quantity. It is usually, but not constantly, tied to the amount of the mortgage payment under the buyer's new loan. Often there is a deposit against damages, occasionally not. There is typically a clause stating the seller will hold the buyer safe for any damage to himself or his residential property which occurs after the sale is consummated and before the seller moves.
The attorney who draws up your contract offer can create such an agreement. If you're using online forms, you should be able to find one for this situation. If you're working with a real estate broker, he or she can handle it for you.
An Some example
I have actually just recently seen a very enjoyable some example of this concept in action. An senior widow contracted to have a one level condo facility built in a brand-new area which provides all outside maintenance. She had had hip replacement surgery and wanted to avoid the disadvantages of the home in which she 'd reared her kids. The home was big, had stairs and was found on a large, partly wooded lot with lots of mature perennials and hedges. Both the house and yard were gorgeous, however high maintenance.
Her contract to purchase required a series of deposits and a firm indication as to her source of funds well before settlement on her new condo. The widow put her home on the market. A young couple with two sons was very anxious to buy it. The situation was competitive. They made the widow an offer. She countered their original offer. She did not raise their offer price, which was slightly below her asking price. She did not believe the young couple would qualify for a larger loan. Instead, she did something rather creative.
The widow countered with a proposal that she " lease back" for a period of " approximately" a particular date (a date beyond her scheduled competitors date on the condominium) in exchange for a modest flat sum to be paid to the purchaser at settlement. The total lease back period was less than 2 months. The flat fee was less than the amount of the new home loan payment for the purchasers. Since they made no payment on their new home loan the first month, it wasn't too far out of line. The couple truly desired the house, so they accepted the counter offer.
Another succeed, win scenario was produced. The widow just had to relocate one time and the young couple got a home they most likely wouldn't have in a straight bidding war. If you find yourself in a situation similar to either the widow or the young couple, maybe you can work out a comparable solution.
Enter the Lease-Back or Rent-Back Agreement
The details of this method vary from state to state, however in the strong seller's market we're experiencing, buyers will frequently accept let the seller stay in the house for a time frame as long as rent is paid. In a competitive scenario, the buyer willing to do this will often have the gaining proposal despite the fact that there is another offer as high as his.
The contract covering the circumstance mentions the length of time the seller will continue to be. It can be finished with a specific date named or wording that allows the seller to stay up to a specific date with the possibility of her relocating earlier. The quantity can be a fixed figure paid of the proceeds of settlement or a regular monthly amount, or a day-to-day quantity. It is usually, but not constantly, tied to the amount of the mortgage payment under the buyer's new loan. Often there is a deposit against damages, occasionally not. There is typically a clause stating the seller will hold the buyer safe for any damage to himself or his residential property which occurs after the sale is consummated and before the seller moves.
The attorney who draws up your contract offer can create such an agreement. If you're using online forms, you should be able to find one for this situation. If you're working with a real estate broker, he or she can handle it for you.
An Some example
I have actually just recently seen a very enjoyable some example of this concept in action. An senior widow contracted to have a one level condo facility built in a brand-new area which provides all outside maintenance. She had had hip replacement surgery and wanted to avoid the disadvantages of the home in which she 'd reared her kids. The home was big, had stairs and was found on a large, partly wooded lot with lots of mature perennials and hedges. Both the house and yard were gorgeous, however high maintenance.
Her contract to purchase required a series of deposits and a firm indication as to her source of funds well before settlement on her new condo. The widow put her home on the market. A young couple with two sons was very anxious to buy it. The situation was competitive. They made the widow an offer. She countered their original offer. She did not raise their offer price, which was slightly below her asking price. She did not believe the young couple would qualify for a larger loan. Instead, she did something rather creative.
The widow countered with a proposal that she " lease back" for a period of " approximately" a particular date (a date beyond her scheduled competitors date on the condominium) in exchange for a modest flat sum to be paid to the purchaser at settlement. The total lease back period was less than 2 months. The flat fee was less than the amount of the new home loan payment for the purchasers. Since they made no payment on their new home loan the first month, it wasn't too far out of line. The couple truly desired the house, so they accepted the counter offer.
Another succeed, win scenario was produced. The widow just had to relocate one time and the young couple got a home they most likely wouldn't have in a straight bidding war. If you find yourself in a situation similar to either the widow or the young couple, maybe you can work out a comparable solution.
About the Author:
Jocel Victorino is a property consultant of DMCI Homes Inc. A premier developer of resort-type condominiums in the Philippines. If you are currently looking for a good investment try Arista Condo (http://www.condosphilippines.org/listings/arista-place/). For Other DMCI Homes Project you may visit Philippines Best Condominiums(www.condosphilippines.org)
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