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TJ, Esq.
TJ, Esq., Attorney
Category: Real Estate Law
Satisfied Customers: 12365
Experience:  JD, MBA
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We want to sell the house, the buyer needs to live in the

Customer Question

we want to sell the house, the buyer needs to live in the house (rent) for 6 months prior, so qw have a 180 day closing, how do we word the rental part in the purchase agreement
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  TJ, Esq. replied 1 year ago.

Hello and thank you for the opportunity to assist you. My name is ***** ***** I will do my very best to answer your legal questions.

I would make two agreements: The first would be the sales contract and it will state "closing is to occur no later than May 1, 2016." Or whatever date that you want. The second agreement will be an ordinary lease for 6 months. If you try to combine them, then things become complicated ... especially if the buyer fails to pay rent and you need to evict him. Suddenly there is a question as to whether he is a regular tenant with a regular lease, etc., etc. From a legal perspective, keeping things separate is much easier. The one bit of additional language that I would add to both the sales contract and lease is "Seller/Landlord may relist the house for sale in the event that Buyer/Tenant is evicted, and the sales contract is void." That way you won't have a situation where you must evict the buyer after a month or 2 because he failed to pay rent, and yet you have to wait until May to sell the house. Obviously you'd want to sell the house immediately upon an eviction.

Does that answer your question? Please let me know if you need clarification, as I am happy to continue helping you until you are satisfied.

Customer: replied 1 year ago.
I understand what you are saying but I had read contracts where the buyer moves in prior to sale, and if contract is broken due to lack of rent payment I don't want to go through a long eviction process - not satisfactory
Customer: replied 1 year ago.
Not satisfactory
Expert:  TJ, Esq. replied 1 year ago.

Hi again.

Well, although I personally would not make them one agreement, you can certainly do so if you would like. You can add language like this to the sales contract:

"Beginning <insert date>, Buyer shall be deemed to be in possession of the Property and will pay a monthly fee of $X.XX until Closing. Closing shall occur on or before May 1, 2016. This provision shall not be deemed as a residential lease, Buyer shall not be deemed as a tenant, and there shall be no requirement to evict the Buyer in the event of nonpayment."

Here are some problems as I see them: (1) Even with the above language about it not being a lease, I don't know how you would realistically get the buyer out of the house without an eviction if he fails to pay rent. I totally understand that you don't want a lengthy eviction. But if he doesn't pay, then what will you do? If you try to physically remove him, he'll likely contact the police, and the police will not likely make a judgment call in your favor. They'll likely look at the sales contract, see that he has the right to possess the house, and see that he already is in possession of the house, and then tell you to get out and take it up on court (which means filing the eviction). (2) What if the buyer damages the house? Can you get rid of him? What if his answer is "hey, I'm buying this house so you shouldn't worry about it"? What law would you use to get rid of him and protect the house? If he is a tenant, then you can rely on landlord/tenant laws. Things are certainly more complicated if he's not a tenant.

But I'm not trying to dissuade you if you think that it's best to go that route. I'm just trying to point out where problems could arise.

Expert:  TJ, Esq. replied 1 year ago.

I suppose, overall you're thinking that if he is a tenant, then things will be more difficult for you. I am thinking the exact opposite. Things become very murky if the buyer is not a tenant. I would not be surprised if the contracts that you are talking about were drafted by real estate agents rather than attorneys.

Expert:  TJ, Esq. replied 1 year ago.

Hello again. I didn't hear back from you, so I'm just checking in to make sure that you don't need more help on this issue. If not, then please remember to provide a positive rating to close out this question (and please remember that your positive rating is the only way that I'll get credit for helping you, so I greatly appreciate it). Thank you!

Customer: replied 1 year ago.
I have to think about it, because I don't have to put won't be evicted for non payment. What I'd I said any lapse in payment voids the entire contract and buyer vacates property immediately and losses earnest money. I have seen contracts that state a house must be kept in good repair at the expense of the buyer . I am not interested in fixing up a house for the buyer so sorry your wording and point of view don't cut it for me
Customer: replied 1 year ago.
I will figure this out my self thank you
Expert:  TJ, Esq. replied 1 year ago.

I understand, and I truly wish you the best.