Closing day and moving day don’t always coincide, but with a negotiated pre-occupancy agreement as part of the real estate deal, they could be as many as a few weeks apart.
A pre-occupancy agreement, also known as an early possession agreement, is a contract that allows a buyer to move into a property before closing day. This type of agreement can be beneficial in certain situations, but it also involves specific risks and considerations for the buyer and the seller. To learn what is needed if a seller would like to maintain possession of the home after closing, see “What You Need to Know About Post-Occupancy Agreements”.
Here’s a closer look at what a pre-occupancy agreement entails.
When Buyers and Sellers Might Consider a Pre-Occupancy Agreement
If a buyer wants to occupy the property before closing day and the seller agrees to allow the buyer to take possession of the home early, the two parties would draft a pre-occupancy agreement to specify the conditions of the agreement. We recommend consulting a real estate attorney to help draft the terms.
For buyers, negotiating a pre-occupancy possession can be particularly beneficial in situations when they’ve already sold their other house. A pre-occupancy agreement can help bridge the gap between when they’ve moved out of their old house and when they can officially move into their new one. Otherwise, they’re often left finding temporary housing or stuck having to move twice.
Seller Considerations When Drafting a Pre-Occupancy Agreement
Early occupancy agreements largely play to the buyer’s advantage, so the seller must be prudent when drafting the terms of the agreement. It’s risky for sellers to allow the buyer to move into the property early because what if they back out of the deal? Examples of more stringent conditions a seller may require on the contract could be for the seller to put down more earnest money and transfer the utilities into the buyer’s name. Additionally, as part of a pre-occupancy agreement, it’s common for the seller to accept the condition of the house as is and consider the inspection period closed.
Contact our Team at Sirulnik Law for Questions about Florida Real Estate Law
If you’re preparing to buy or sell a new property in the Miami area, it’s important to consider all your options. Our team of experienced real estate attorneys work closely with domestic and international clients who are looking to move to the area. We can help ensure your purchase agreement is negotiated to meet your needs and that your closing is seamless. Contact our team at the Law Offices of Alex D. Sirulnik, P.A./ADS Title Services, Inc. to learn more about how we can help you.
