The longest time I ever had a home marked "pending"

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Real Estate Broker/Owner with Austin Texas Homes, LLC 453249

I had a higher-end listing that we put on the market in 2005, and we got a contract pretty quickly quickly (not right away - maybe three months).  The buyers asked if they could move in a week or so before the closing, because they have seven kids and they were staying at a local hotel which was costing an arm and a leg.  Although we were all a bit skeptical and wary of letting them move in early, we decided to allow it, but we put in a rather punitive amount for the "holdover" period.  In other words, if they didn't close by August 31st, 2005, they would be paying $300/day.  We thought this would be sufficiently motivational to get them out or get it closed. 

Boy, were we wrong!  They paid this amount and then continued to pay for about a YEAR!  Yes, they paid $9000/month for almost 12 months.  They kept claiming that the Patriot Act held up their money crossing the Canadian border, or that there was some other snafu.  They would get behind for a month or two, then pay a lump sum of $27,000 to the seller.  She finally got tired of dealing with them and decided to evict them for non-payment.  The sheriff's office had to forcibly evict them from the property.

Needless to say, this was the longest time I have ever had a home marked "pending", and it didn't close with that buyer.  We got the property cleaned up and repainted, then we hired a professional home stager to come in and work her magic.  The home was under contract again very quickly, and we closed not quite two years after we had originally listed.  The seller told me that I had really "earned my money" on this one, which was gratifiying indeed.

Note to self and to others: If you can avoid it, DO NOT let buyers move in before the closing occurs!

 

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If you're looking for a home in the Austin area, you can also visit my primary website at www.austintexashomes.com.  Thanks!

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Topic:
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Location:
Texas Travis County Austin
Tags:
buyers
leasing
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Rainer
99,454
Ashley Drake Gephart
Drake Intel Group - Albuquerque, NM
Jason I learned that lesson as a teenager. My folks sold the house and we had already moved into our next one. So when the new buyers asked to move in before closing and rent my parents thought it would be OK since he was in the military. Well he didn't re-enlist before closing so his loan was denied. At least he moved out peacefully.
Aug 07, 2007 06:39 AM #1
Rainmaker
145,922
Arizona Real Estate Associate Broker
MR Realty - Mesa, AZ
Jason-  If at all cost we avoid pre-possession, I highly recommend to my sellers that they need to consider the liabilities of course, that to me is reason enough (the Brokers liability as well). However, on a few occasions we did allow it and we did as you mentioned, put together a pre-possession addendum together but also include a clause that requires the seller to add insurance for renters and also for the buyer to purchase or put his insurance policy into effect (now yours was a cash buyer), tough sticky situation and honestly I highly advise my sellers not too let anyone other than the owners to have possession prior to close, not even the carpet layers for the buyers!! Anything can happen...what would happen if there were a fire, flood or something?
Sep 19, 2007 04:22 AM #2
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Jason Crouch
Austin Texas Homes, LLC - Austin, TX
Broker - Austin Texas Real Estate (512-796-7653)
CANDACE - Absolutely.  Thanks for your comments (as always).  This was one of the first blogs I ever wrote here at AR (no graphics).  The whole situation was a mess, but at least they were paying a healthy sum to live there for those months.  That made it much easier for the sellers.
Sep 19, 2007 04:36 AM #3
Rainer
24,581
Danny Nappi
Zest Realty - Riverview, FL
Jason , I am always skeptical in having seller allow buyers to move in prior. This situation you had even makes me more skeptical. Great post.
Sep 19, 2007 07:39 AM #4
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Jason Crouch
Austin Texas Homes, LLC - Austin, TX
Broker - Austin Texas Real Estate (512-796-7653)
DAN - Please feel free to use this story as a warning to your clients.  You can just say, "An agent that I know had this happen once....."
Sep 19, 2007 12:03 PM #5
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