A Rent-Back occurs in Real Estate when the seller has to rent back the home that they just sold to the buyer.
Rent-Backs can take anywhere from 3 days to 6 months depending on how long it will take the seller to find a new home.
In today’s post we will cover the basics of Rent-Backs so you are more knowledgeable about the process if you think you may need to rent back your home after you sell it.
When to Talk About Rent Backs
If you think you may need a rent back after you sell your home it’s best to negotiate with the buyer first before they purchase your home. Let them know you will need to rent back for a brief period of time until you find a new home. Your Realtor should be able to negotiate this for you and will make sure it’s in the contract so all parties are on the same page.
Lenders and Rent Backs
Did you know that most lenders have Rent-Back requirements which stipulate how long the borrower can rent back the home to the previous owner? Some lenders have Rent-Back requirements of 90 days so it’s always best for the buyer to confirm this with their lender and speak with the seller in advance about Rent-Backs before the buyer agrees to buy the home.
One of the most difficult aspects of Rent-Backs for some buyers and sellers is negotiating rent. Typically, the Rent-Back amount will be “Fair Market Value” and is calculated on a daily basis so you aren’t paying for a full month’s rent if you only stay 10 days after closing.
Learn More about Rent Backs
To learn more about Rent Backs or view homes for sale in the area contact Fred Sed & Associates today by calling us at (949) 272-0125.