October 15, 2020
Many homeowners would happily sell their home if they knew they had options once their home closed escrow. Selling today might be a seller’s best opportunity to cash in on a hot market, but where does that seller go next? When would this seller vacate their home? There are many ways to structure the timing of your move. A typical escrow is 30 days long. Escrows tend to take 30 days because that is the amount of time a lender needs to underwrite and fund the buyer’s loan. A cash buyer can close much sooner because there is no lending involved.
In an ideal world a seller would be able to vacate their home a few days before closing. Life is not always ideal so let’s layout a few more options.
A seller can always ask for, and negotiate a longer escrow. This will certainly allow for more time in the home, but longer escrows can lead to issues. It’s always a good idea to put the money in the bank as soon as possible. During a long escrow a buyer could lose their job, get a divorce, find another home that suits their needs better, or win the lotto and decide to move to Hawaii.
A seller can negotiate with a buyer to rent their home back after the close of escrow. A buyer’s lender will allow for up to a 60 day rent back without creating any issues with the buyer’s financing. The seller’s rent payment typically covers the buyer’s mortgage payment, taxes, and insurance (and HOA if applicable). The rent can be a lot more than the seller’s current mortgage so that’s something to consider as seller. This does give you extra time in your home while you hunt for the next home.
If you have put any thought into selling your home and would like to discuss the timing of it please reach out to us. We’ll happily layout a plan that works for you.
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