Real estate transactions can sometimes be complicated, especially when a seller doesn’t vacate the property after closing. Dana Sparks, a seasoned broker of Maximum One Greater Atlanta Realtors and director of the Real Estate Academy of America, recently addressed this issue in her video titled, “Seller Won’t Leave After Closing… Now What?” Here’s a comprehensive breakdown of the video’s content, along with some background information to provide a well-rounded understanding of the topic.
Understanding the Temporary Occupancy Agreement
When a buyer and seller come under contract, they might negotiate for the seller to stay in the property for a short period after closing. This arrangement is formalized through a Temporary Occupancy Agreement. However, complications arise when the seller doesn’t vacate the property as agreed upon.
Dana emphasizes the difference between purchasing a home with an actual tenant in place and a situation where a buyer and seller negotiate a temporary stay for the seller post-closing. The latter uses the Temporary Occupancy Agreement, which allows the seller to remain in the property for a specified period after the closing date.
When The Seller Won’t Leave After Closing
There are instances where sellers don’t leave the property after the agreed-upon period. This can happen due to various reasons, such as their plans falling through or unexpected delays in their next housing arrangement. In such cases, the seller is legally considered a “tenant at sufferance” in Georgia. This means they remain in possession of the property after their lawful right to do so has expired.
Legal Implications and Remedies
If a seller overstays, the buyer, who is now the legal owner of the property, must go through the eviction process to remove the seller. The GAR (Georgia Association of Realtors) Temporary Occupancy Agreement outlines that sellers unlawfully holding over are subject to “holdover rent.” This isn’t traditional rent, as there’s no landlord-tenant relationship in this context. Instead, it’s a fee the seller pays to the buyer for each day they remain in the property beyond the agreed-upon date.
If the seller defaults on the Temporary Occupancy Agreement, the buyer can sue them for actual financial damages. This is different from a default on the Purchase and Sale Agreement, where the remedy is typically limited to the earnest money.
Advice for Real Estate Agents
Dana offers a crucial tip for agents: If a buyer and seller agree that the seller will stay in the property temporarily after closing, they must complete a Temporary Occupancy Agreement. This ensures that all parties are clear about expectations and consequences if the seller fails to vacate on time.
While the process of buying a home can be exhilarating, unforeseen challenges like a seller overstaying their welcome can dampen the experience. It’s essential to be informed and prepared for such scenarios. For a more in-depth understanding and visual explanation of this topic, viewers are encouraged to watch Dana Sparks’ video in its entirety.
For more insights and expert advice on real estate matters, check out Dana Sparks’ video and subscribe to her channel for regular updates. Curious about what to do when you close on a property that has a tenant? Read more about that here.