Purchasing an FSBO home can be a horror show for a buyer if, after closing, the seller just flat out refuses to leave. That’s what happened to Tennessee resident Tamara Holloway, according to a June 23 article on Inman.com. Although closing went through on the Nashville home she purchased, the seller continued to live in the house with no moving date in sight.
In the article, “4 essentials on your closing checklist that prevent an FSBO nightmare,” Inman.com staff writer Marian McPherson reported the seller, Justin McCrory, was interviewed by a local television station about his refusal to leave the home.
“McCrory pointed out that he ‘technically’ didn’t have to go anywhere because he listed the home as an FSBO,” McPherson wrote. “Holloway did use an agent, and the title company that handled the closing said it sent an email with the date of possession to McCrory, but he never responded.”
Holloway eventually began eviction proceedings to get McCrory out of the home.
This type of incident can be avoided, according to McPherson, if buyers take a few precautions before closing on their new home. Here are four tips she provided from the Lab Coat Agents Facebook group:
1. Have the date of possession clearly listed in the contract — In any FSBO transaction, the date of possession should be outlined clearly in the contract. Although the group members differed on how much time they give sellers to move, McPherson wrote all agents agreed that Holloway’s agent should have made sure the date of possession was clearly written and agreed upon.
2. Get the keys — ASAP — Make sure your clients get the keys to the home as soon as possible after all paperwork has been signed. “Some seller’s agents will wait until they receive funding confirmation from the title company, but the keys should be handed over as soon as the confirmation is sent,” McPherson wrote.
3. Have a final walkthrough — Although the buyer has probably done more than one walkthrough of the property, a final one before closing is crucial. Consider Holloway’s situation: “If Holloway and her agent had done a final walkthrough, they might have been alerted to the fact that McCrory had no intention of moving out anytime soon (or ever),” McPherson wrote.
4. List a fee charged per day until the home is vacant in the contract — Money is usually a motivating factor in any transaction, so including a daily occupancy fee charged to the seller — like McPherson reported Nevada Realtor Steven Khalilzadegan said he does for each of his clients — may prevent a situation like Holloway’s from unfolding.
What other tips do you have for FSBO buyers? Let us know.