Seller’s Temporary Residential Lease (Leaseback)
As the housing market continues to evolve in 2023, Members Title has seen an increase in the use of a Seller’s Temporary Residential Lease, or leaseback. A leaseback is an agreement during the closing process to allow the seller of the property to lease it back from the buyer. TREC’s Seller’s Temporarily Residential Lease mandates the seller occupy the property for no more than 90 days post-closing. The terms of this agreement, such as deposit, rent per day, utilities payment, and hold over charges, are open to negotiation between buyer and seller. Additionally, tax proration could potentially be negotiated, as the seller would reside in the property past the date of closing.
If you are anticipating the use of a Seller’s Temporary Residential Lease, there are some things to know. It’s important both parties in the transaction have an understanding of property insurance coverage. For example, if the seller cancelled his property insurance on the date of closing, but is using a temporary residential lease. It’s equally important to establish a specific move out date, and walk through date with all parties involved. These parameters help protect your interests in the seller’s temporary residential lease.
If you have any additional questions, or concerns, about the use of a leaseback, please reach out to us at firstname.lastname@example.org.