Seller Occupancy After Closing 

  I want to tell everyone a little story about Occupancy After Closing and why it is so important from a buyer's position to have a written document.  Not to long ago, I represented a buyer who purchased a home in Hendersonville, Tennessee located in a popular lakeside community.  

Occupancy After Closing

 Because the seller was building a new home, part of their negotiations to my buyer was that they would like to occupy the home for 3 days after closing in hopes that their nearly finished new home would be ready to move in.

Get it In Writing!

My buyers agreed and we prepared an Occupancy After Closing document that we presented to the sellers and they agreed to sign.  Many times agents and buyers/sellers do not write up a specific occupancy agreement and just write into the contract that the buyer will give occupancy to the seller until a certain date.  In writing this, my goal is to convince you of why it is so important to always have a document outlining liability even if just for a few days as you never know what might happen...

On a Wednesday afternoon, we all went to closing with the understanding that the sellers would occupy the house until that Saturday and the buyers would start moving in on the Monday.

Typically, a good occupancy agreement will spell out who pays for insurance, who is liable for damage, what daily rate will apply should the sellers delay their move out date, the amount the seller will put down for a deposit, etc.  As it turned out, our Occupancy Agreement was written correctly and was critical in knowing where to place liability.

The sellers had a moving company packing their belongings and moving everything out on that Friday which was sooner than expected. Remember that the buyers were not arriving until that Monday as they wanted to get a few repairs done prior to moving in.  As far as anyone knew, the move out went smoothly and all parties were happy.  On the Monday morning, the buyer's repairman showed up at the house to do the few repairs and let themselves in.  As they went around the house taking care of some preliminary painting preparation, they went to the basement.  This is where they found a large pool of water that was coming from inside the walls!! This leaking had been going on since Friday

They immediately traced the water to the 2nd floor where the laundry room was.  What was discovered was that in removing the washing machine and disconnecting the water, apparently the moving company had inadvertently left the washer water spigot on in a slight dripping mode.  This created a weekend's worth of water dripping behind the wall and all the way to the basement.  It ended up being thousands of dollars in repairs, mold remediation, new carpet, drywall, etc.  It took well over a month to get the house back in order with the stairwell and other walls being completely torn out to allow for drying of the wood framing.  Even insulation had to be removed.

The neccessity of the written Occupancy will be clear to you as i tell you that it stated: " The Seller hereby agrees to be responsible for any damage to the property prior to or during the move"  

Who Is Responsible for Damage?

Even though the seller felt the moving company was responsible, they still had to pay the buyer directly for the damages.  The seller was able to get their homeowner's insurance to cover most of the damage less their deductible and eventually the insurance company was reimbursed from the moving company.  

In the end, the buyer although very upset with the damage to their new house, realized that without that 3 day written agreement, they would have had a terrible time trying to get either the seller, the moving company or either of their insurance companies to pay for the damages.

So, if you ever feel the need to grant occupancy to a seller, or if you are a seller and want to have a buyer grant you occupancy, keep in mind that unexpected things really can happen.  Or, if you purchase a new home, and you don't plan on moving in immediately after closing, make sure you check all upstairs plumbing to insure you wont have the same issue. 


Kim Blanton 20 Years as a Realtor

Posted by Kim Blanton on


Email Send a link to post via Email

Hello and thank you for sharing this Great information with us here.

Posted by Zivak Realty on Wednesday, February 22nd, 2023 at 3:37am

Leave A Comment

Please note that your email address is kept private upon posting.