Here’s how you can use a rent-back to appeal to sellers.
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What is a rent-back? A rent-back is when a buyer offers the seller the right to occupy the property after closing on the sale for a set period of time. If you, as a buyer, were buying that home to be used as a primary residence, your lender would like your rent-back period to be no longer than 60 days. If you’re buying it as an investment property, you can negotiate a rent-back period of however long you like.
To help you understand, suppose that you’re selling your current home on the market while you’re having another home built elsewhere that won’t be ready for some months down the road. In that situation, you’d want to find a buyer who would purchase and close on the home so that you could get the money from the sale, and then rent the home back to you until your other home was finished and you were able to move in.
“Rent-back agreements can be a win-win opportunity for buyers and sellers.”
This situation might appeal to buyers who currently live on leases. If their lease doesn’t end until around the time the seller’s other home is finished, it’s a good idea for them to purchase a home now and lock in a low interest rate until they can move in, all while the seller pays them to live in the home they’ve just purchased. Rent-back agreements can be a win-win opportunity for buyers and sellers.
Always be sure to ask the seller or their agent what would make an offer most appealing to them. If you have any questions about what you can do to make your offer stand out and give you a better chance of winning a bidding war against other buyers, feel free to reach out to me. I’d love to help you.