Delayed Possession…what it is & means to you

by | Nov 13, 2016 | Real Estate | 0 comments

Upcoming Free (& non-promotional) Home Buyer Classes:

Saturday, November 19th, from 11am-2pm (ish
         Vancouver YMCA, conference room
11324 NE 51st Circle, Vancouver WA (corner of SR500 & Gher Road/112th Ave)

Saturday December 3rd , from 9am-12pm (ish)
   Marshall Community Center, conference room
       1009 E. McLoughlin Blvd, Vancouver WA (kitty corner from Clark College)
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If these class dates and/or times don’t work for you, please let us know.  We understand that you have lives, and families, and work.  We will work something out that works better with your schedule.  Just let us know….
….we also have home seller classes available too…link on left on website

Remember…with reservation…we will throw in lunch, or dinner!  😀
~~~~~~~~~
Happy Sunday night!

Another quick reminder that we have our Winter Client Appreciations coming up…  yep, plural this year!  Chris Berg and I are honored to invite you to either Disney’s Moana on Saturday, 12/3 from 3pm-6pm….OR… Star Wars: Rogue One on Saturday, 12/17 from 3pm-6pm (time could change slightly for Star Wars).  While Moana is now full, there are tickets for Star Wars still.  Please let Jennifer Komp at jkomp@pcmloan.com, or Jennifer Cobb at jkcobbllc@yahoo.com, know that you would like to attend and they will send you the link to get your tickets.  😀  Tickets are first come, first served…and no assigned seating.  Chris and I want you to know that we appreciate you!  We appreciate your trust, your friendship, and your referrals!  So…come watch a movie with us!!  😀

What a game tonight!  Sorry…  I like football and the game with the Patriots was really good and right down to the last couple of seconds and a missed catch…  wow!  Anyhow, while the game was great…what happened last night, and into this morning….was not.  This week we are going to talk about Delayed Possession…

What is Delayed Possession?  Why is it important?

In our current market, many homeowners are selling their homes, and moving into new ones.  When a seller is living in their home, and selling it to buy a new one, they need the equity from their current home to buy the new home.  So far…so good… right?    Homeowner puts home on the market…homeowner/seller gets offer.  Now homeowner/seller has to find a new home.  Homeowner/now buyer finds a home, makes offer, and gets accepted.  Remember that homeowner/seller/now buyer can’t buy new home until they sell old home, right?  Now, this part is all about timing.  Homeowner/seller/now buyer has to close on old house first, and then close on the new home afterwards.  This is called a “simultaneous closing”…meaning homeowner/seller/now buyer closes on old house on Tuesday, and using the equity from their old home, closes on new home on Wednesday…or closes on both homes on the same day.  Of course, the homeowner/seller/now buyer can not move into their new home until it closes, and they can’t close on their new home until they close on their old home…so what does the homeowner/seller/now buyer do?  Why..they ask for Delayed Possession.  The homeowner/seller/now buyer requests that their buyers (for their old home) gives them time in their old home after closing so they can move into their new home.  At this point you might think that this all comes after the deal is accepted, but it’s not.  The delayed possession is agreed upon when the offer is written.

Ok…  so we’re out looking at homes… some are vacant, and many have homeowners in them.  We find the ‘perfect’ home, but the listing says that the seller needs time after closing to move into their new home. The seller is asking for Delayed Possession.  Maybe the seller counters your offer requesting delayed possession… either scenario is likely.  We can always ask for rentback in this situation…meaning the seller will pay you rent for them staying there…usually at an amount equal to one day of your mortgage per every day they are there.  In a multiple offer situation you might not be asking for rent back.

Now, you know what Delayed Possession is… let’s explain it a bit further.  Once you close on your new home your home owners insurance kicks in.  The homeowner/seller/now buyer switches over to a renters insurance.  Renters insurance, as you know, only covers the contents of the home…not the home itself… that’s yours since you are now the homeowner.    So what happened yesterday/today?

I have a client who put her home on the market, she received 5 offers on her home.  Three of the offers offered my client delayed possession, and the offer she accepted gave her 14 days after closing to close and move into her new home…rent free.  This was a good thing because it actually took us 6 days after closing her home to close on her new home because her seller had not done the requested repairs from the inspection, and we refused to close until we had those receipts showing those repairs had been done.  Sometimes…this happens too.  We closed on her New home on Monday, and keys were transferred today.  Friday night my client, and her SO packed up her home, and left at 10pm.  Plan was to finish on Saturday afternoon after work, and clean the home Saturday evening/Sunday.  I received a call from her yesterday afternoon that she thinks someone broke into their old home after they left on Friday because a window was ajar, the back door was unlocked, and they found folded cardboard on the basement floor, a couple of empty beer cans, and the unwrapped remains of the children’s halloween candy.  They noticed the spare keys were missing, and a couple of other small items…but all in all…. nothing else seemed to be amiss.  It was weird…and kind of funny…  someone broke in, ate all the candy (touching nothing in a full fridge or freezer), drank a couple of beers…and took a nap.  She switched out the locks though, and braced the ajar window, to be on the safe side since the spare keys were now missing.

Then I got a frantic call last night…  well, it wasn’t so harmless after all…  this halloween candy napper had also cut the lines to the heat pump & furnace and stripped out the copper lines…about 10ft of it.   S/he also cut the the clutch out of my clients SO’s motorcycle.  Now…we have an issue…. who is responsible for this?  I called the buyer/new homeowners agent to let her know what was going on, and so we could figure out who is responsible here.  You see…this is now a grey area… because while the rental agreement says that the new homeowners insurance is to take care of it, but the original purchase/sale agreement says that the home will be received by the new homeowner in the same condition as it was when they made the offer, and did the home inspection.  All systems/appliances also need to be in working order, and my client has not transferred keys yet.
I’ll be honest with you… this could have gotten very ugly…  in the end, my client is going to either pay for the deductible, or the damage…whatever is less, but she’s not happy about it.  While the new home owners, and their insurance are liable, she is still in possession of the home so it’s a mixed bag.  She spent the night last night in the old home to make sure that halloween candy napper didn’t come back…with her two big dogs, and a bat.

This is an extreme situation, and the first time in 13 years I have had something like this happen at this stage in the transaction.  Typically, with delayed possession we worry more about whether or not the home is left in a clean condition, or if the homeowner/seller is going to leave the home a mess, or trash still in the home.  I know plenty of agents, including myself, who have spent time cleaning a home after a seller left it messy.  When the home is vacant prior to closing (even if it is after signing), we can do a walk through of the vacant home…in fact, I am doing a walk through of a vacant home on Tuesday.  When the homeowner/seller isn’t moving out until after closing though…there is no way to do a walk through.  95% of the time, the homeowner/seller leaves the home empty and fairly clean…but sometimes we deal with that 5% of the time when they don’t.  During the home inspection period, you can request that the seller has the home professionally cleaned (and/or the carpets professionally cleaned) upon closing, and pre-paid.  Receipts are important.  Of course, if the home has bigger repair considerations during the inspection, you may want to concentrate on getting those repairs, and the receipts for those repairs.

Anyhow, this all being said… Delayed Possession is something we are dealing with right now, and fairly frequently as more and more homeowners are selling their currents homes to move into their next home.  It’s important to understand how it works, and ways that we can try to protect you.  I tell you…there’s a reason why I don’t drink much… I’m afraid if I start..that I won’t stop some days….

Information is power, and I hope that I am able to help you.  Good luck, and as always…May the odds be ever in your favor out there….  AND If you are looking for a real estate agent, I would love to be able to help you.  
 As always….this is just a quick overview…. again…and I can’t say this enough…please remember that your agent is NOT a salesperson, and should not be acting like one.  Real Estate is not really about houses, it is about relationships.  Your agent, and your lender work for YOU.  You drive the bus…we are merely GPS to help you get to your goals.  Like the classes, this weekly blog email is to help you with your home adventure.  The goal is to be informative and non-promotional.  🙂  We are, however, hoping you will call and want us to help with your adventure.

If you have any questions about this, or something you have heard…or if you would like me to help you with your home adventure, please call, email,  text, or facebook me anytime.  I am, as always, happy to help!

Thank you again for your business and your referrals!!  …and thank you for referring these classes to your friends, family, and co-workers.

.   ..disclaimer…if you have already purchased a home, or would no longer like to receive these emails, please let me know and I will be happy to remove you from any further mailings…

Upcoming Topics: Escrow Accounts, and what they do
Last Week:  What’s in my mortgage payment?

Have a great day, and I will talk to you soon,
;-D

Tracie DeMars / Realtor

ReMax Equity Group
License# 81289
Vancouver, WA
360-903-3504

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