Understanding leasebacks
If you haven’t heard of a leaseback, it is a temporary lease from either a buyer or a seller during a real estate transaction. They’re usually short-term leases that range between 2-5 days max. So by definition, a seller leaseback is asking the buyer if they can lease it back from the new buyer after closing. A buyer leaseback is asking the seller to lease the property prior to closing.
A seller might ask for a leaseback if they’re not exactly ready to move out. Maybe the house they are purchasing isn’t ready yet or maybe they need a couple of days to move out and clean up.
A buyer might ask for a leaseback if they already sold their house and don’t have any temporary living arrangements prior to closing on the current home. They are basically asking to move into the property prior to closing. Maybe they closed on their sale on a Friday and closing for their purchase isn’t until Monday. So they would be asking the seller if they can move in a couple of days sooner with all of their belongings.
Both scenarios can be very risky and volatile to both parties if the leaseback does not provide specific criteria to protect everyone. For example, deposit amount, daily rates, holder rate, etc…
So just make sure you ask your realtor if they understand the concept of leasebacks in case it comes up. If you want more information, please don’t hesitate to reach out to us so you can make a well-informed decision. Thanks, y’all have a great day!
