What is a Rent-back Agreement?

What is a Rent-back Agreement?
Sean:
Hey, this is Sean with Unlimited Real Estate Solutions here in Delaware County, Pennsylvania. And one of the questions we get when we speak with sellers sometimes is, “I want to sell my house, but…” And then they might either say that they need to find a new place to go or they’re waiting on source, some sort of situation to go through before they can actually sell the property. So they’ll say, “Hey, is there a way we can put an agreement in place? Or maybe we can stay in the property for a little bit after you purchase it until we get our ducks in a row?” So, “We are in it for the long term” is always my answer. And we are happy to work with sellers in any way that we can and we just need to make sure we structure it properly.

So there’s been situations where we’ve signed an agreement to purchase the property, and in that agreement we said that we would purchase it seven days after the seller has identified and scheduled a closing on their next house. And we’ve done other situations where we’ve created what’s called a “rent-back agreement”. And just real quickly, the rent-back agreement means we close and purchase the property, we transfer the funds, and we have in place an agreement where the seller can stay in that property for X amount of time. And there’s usually certain terms in place, but what that allows us to do is we can purchase a property and get you your funds and then you can go ahead and use those funds for the purchase of your next property or whatever it is that you need them for, which is why you’re selling the house, and not have to worry about getting out right away, getting all your stuff out of there. It gives you a little bit of extra wiggle room if you need it.

So if you are thinking about selling your home and you’re just not sure when you’re going to be able to move, but you know that you want to get an agreement in place soon, give us a call. I’d be happy to talk it over with you, or you could fill out a form on our website and we’ll reach out. Thanks. Take care.
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