When a buyer purchases a home, the normal course of events involves the buyer receiving the keys to the house and the seller vacating before or on the day the transaction closes. Things don't always go according to plan, though, and sometimes sellers can't—or even downright refuse to—vacate the home by the agreed upon date. Here's how to handle the issue.
Determine What the Problem Is
The best solution to the situation depends on why the seller won't leave, so your first step is to talk to the real estate agent or the seller directly to determine what the problem is and how long it will take to resolve it. For example, the seller's own post-sale housing may have been delayed. If you can wait to get in the home, the best option may be to ride it out. Set a new move in date, and put it in writing. You can even charge rent to cover your mortgage payment if the delay is going to be long (e.g. a month or more).
If there doesn't appear to be a compelling reason why the seller is still hanging around or you must get in the home on closing day, you'll have to put your foot down and insist the person vacate the premises. Explain to the seller that you've already made arrangements to move and must continue with the property transfer as stipulated in the sales contract. Advising the seller you'll seek reimbursement of associated expenses from him or her if you have to make last minute changes may prove to be adequate motivation for the person to leave as agreed.
Withhold the Money
If you haven't formally closed yet, postpone doing so until the seller is ready to leave. Retain a portion of the purchase prices (e.g. 20 percent) and put it in escrow, and let the seller know the money won't be turned over until he or she vacates the home and leaves it in good condition. This protects you in case the seller damages the home while occupying it. It may also be a good idea to put the real estate agent's commission in escrow as well because this provides him or her with the motivation to ensure the seller leaves the home on the agreed upon date.
Be sure to consult a real estate attorney and have your purchase contract amended to reflect the changes (or have a new agreement created). It should contain a cancellation clause that lets you back out of the sale if the seller continues to delay moving out, which may provide a strong impetus for the person to make the appropriate arrangements.
Initiate Eviction Proceedings
In rare cases, the reason the seller doesn't leave the home is because he or she doesn't want to or has some distorted sense of entitlement to remain in the house for as long as he or she desires. For instance, a Tennessee woman purchased a home from a seller who refused to leave after closing on the house and wouldn't indicate why; they just said they had a right to be in the home. Eventually, the buyer had to seek out an eviction order, but the media attention surrounding the incident eventually motivated the seller to leave.
You may have to resort to similar legal remedies if the seller is suffering under the same type of misunderstanding and refuses to rectify the situation. Be aware, though, that evictions take time. For instance, in Michigan, you'll have to serve the person notice of eviction proceedings and then wait up to 30 days before you can get an eviction order from the court. However, law enforcement will physically escort the person off the property if he or she hasn't already left by the time it gets to that point.
Many sellers often give signs they're not ready to move out during the sales process, which is why you want to work with a real estate agent who can recognize the red flags and steer you towards sellers who are serious about leaving. For more information about this issue or help finding the home of your dreams, contact a real estate agent.