Sell My House and Stay In It: The Ultimate Guide

Looking to sell a house and still to live in it?

Owners often prefer to sell their house and stay in it after closing. Many are unaware you can easily get cash for your house and continue to reside there after closing.

Real estate companies and rental investors will buy your house and “rent it back”. Sell and rent back companies allow owners to sell and stay long-term as a tenant via a leaseback arrangement.

Want to learn more about how you can sell a house without having to move out after closing?

Read on to get all the details in our “Sell My House and Stay In It: The Ultimate Guide”!

  1. Can I Stay In My House After Closing?
  2. Method One: Stay For Free For a Short Time
  3. Method Two: Become A Tenant (“Leaseback”)
  4. Method Three: Home Reversion
  5. Who Will Buy My House and Rent It Back?
  6. How Much Rent Will I Pay?
  7. Example Documents

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Can I Stay In My House After Closing?

You absolutely can continue to live in your home after you sell it.

Buyers understand selling owner-occupied property is a challenge and frequently agree to a short stay post-closing. Real estate companies and investors even offer the option to stay long-term as a tenant.

dont-move-out-at-closing
You can sell your house without the stress of moving. Ask for a free post-closing stay, or to become a tenant to live at the residence long term.

The bigger question for sellers is whether it makes sense to try to continue to live in the residence.

Remaining in the home after it sold has a drawback.

Buyers sometimes pay less due to post-closing occupancy. You get to stay after closing, and in exchange, give the buyer a break on price. It’s a trade-off.

Frequent reasons homeowners opt to stay after closing include:

  1. Relocation. Sellers often don’t settle on a relocation plan until after the sale. Moving to a new place may not be possible until receiving sale proceeds (to make a down payment or first month’s rent). Sellers like to ensure their current home closes before incurring the financial obligations of a new one to avoid double housing expenses.
  2. Preparing For The Move. Got a house full of stuff? Moving can be daunting. Weeks of planning, packing, and organizing may be necessary. You can calmly move out with a post-closing lease.
  3. The House Fits. Owners “sell and stay” for the cash from the sale (not because they want to move out). Bedrooms, bathrooms, and amenities may be a great fit. Perhaps you’ve grown to love the home. Living long term as a tenant at the property is a good option to get cash now without giving up a favorable living arrangement.
  4. Great Neighborhood. Blue ribbon school distrct? Transportation access? Nearby family? Friendly neighbors? Job opportunities? Economic growth? All reasons to stay in the area. Selling with a long-term leaseback is an excellent solution if you love the neighborhood.

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Method One: Stay For Free For a Short Time

Just need a brief period after closing to stay?

Request permission from the buyer to stay post-closing for a few weeks or months.

Buyers frequently allow post-closing occupancy – in many cases free of charge. Risk of accidental property damage is high if the seller is forced to race out the door. Happy sellers are more likely to protect the asset.

The post-closing occupancy also gives the buyer’s offer an edge. An offer allowing a month post-closing free of charge is more likely to be accepted than one demanding the seller immediately vacate.

Getting a short period to live in the house after you sell it makes sense if you wish to relocate or move out in the near future.

A “leaseback” is a better option to stay in the home for a year or more.

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Method Two: Become A Tenant (“Rentback” or “Leaseback”)

Have you considered selling your house for a lump sum of cash and becoming a tenant?

Homeowners often are unaware of this option. It’s a terrific way to cash out home equity without re-building your life in another location.

LegalMatch defines a lease back like this:

A seller leaseback, also called a seller rent back or sale-leaseback, is a financial transaction in which a person sells property and then leases or rents from the new property owner. In this scenario, the seller no longer owns the property, but lives in the property for the length of time stated in the rental agreement. The seller realizes profit from the sale of the property while the buyer is assured of rental income from the lease agreement.

The key steps to a leaseback are as follows:

lease-back agreement
A “lease back” or “rent back” agreement let’s you get cash for your house and stay long term as a tenant. This is a great option to get paid today without having to rebuild your life .
  • Buyer and owner agree on sale price and closing date.
  • Buyer and owner agree on a lease terms, including monthly rent and length.
  • Buyer and owner execute the purchase contract and lease agreement.
  • Upon closing, owner receives the lump sum cash payment and transfers ownership to the buyer.
  • The previous owner makes a security deposit and is now a tenant in accordance with the terms of the agreed upon lease.

Pay attention to lease details. The “terms” of the lease agreement often determine whether the leaseback will be a positive experience. Important lease terms for most prospective tenants:

  • Termination Date and Renewal Options. Most lease agreements terminate after 12-months and do not auto-renew. However, each lease and state is unique.
  • Security Deposit. Payment to the landlord to ensure that rent will be paid and other tenant responsibilities complied with.
  • Rent Payment Grace Period. Window of time, typically 3 to 5 days, that tenants have to pay rent before incurring a late fee.
  • Fixtures Provided. Most apartments come with kitchen appliances. Make sure to ask the landlord if these will not be provided.
  • Remodeling Restrictions. Like to paint? Install a TV on the wall? Check the rules before making modifications.
  • Homeowners Association Rules. Townhouses and condos typically belong to a “Homeowners Association” that specifies rules and regulations for all occupants.
  • Number of Occupants Allowed. Got a big family? Planning for children? The written lease could limit your options.
  • Guest Policy. Like to entertain overnight guests? Some landlords restrict the hours and number of guests.
  • Subletting Policy. Subletting occurs when a tenant rents out the property they are leasing from the landlord.
  • Pet Policy. Landlords and buildings often restrict pets by size, weight, and type.
  • Renters Insurance. Protection for belongings and coverage for additional living expenses, should the rental become uninhabitable.

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Method Three: Home Reversion.

“Home reversions” are a tax-free form of equity cash out relied upon by the elderly to cover on-going living expenses. You sell the equity in your home for either a cash lump sum, monthly income stream, or both.

Typically, you get between 20 to 60% of the market value of the house via the lump sum. When your home is sold in the future, the company that provided the home reversion receives a share of the proceeds and the rest goes towards your inheritance.

The advantage of home reversion plans is that you receive money to manage costs of living, remaining in your home long term, avoiding moving stress, and tax benefits.

The disadvantage is heirs have a reduced share, you get less than full market value had you formally sold the home to a buyer, and maintain responsibility for costs of ownership (as opposed to becoming a tenant – when the landlord covers most costs).

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Who Will Buy My House and Rent It Back To Me?

The traditional course of selling a house goes like this: hire a real estate agent to list your house for sale on the MLS, a prospective buyer is found, and at closing you move-out and the buyer moves in.

If you want to sell a house and stay in it, you need another option. You won’t get a leaseback off the MLS.

Buyers on the MLS generally intend to move in themselves. Even landlords like to fix things up and install their own tenant at highest market rate. Negotiating a lease and a home sale via real estate agents is rarely successful.

who-will-buy-my-house
Real estate investors and rental companies normally allow sellers to stay in the house after closing – either for a short period of time or long-term as a tenant.

Finding a buyer with experience in post-closing tenancies is the easiest way to “cash out” your equity via a rentback scheme.

Real estate investors buy houses and rent them back to you. A “sell and rent back” company is typically an experienced landlord.

You can even negotiate a higher offer because your saving the rental company the hassle of trying to find a tenant and having a period where there is no rental income.

How can you find real estate investment company that will help you “buy my house and rent it back to me”? The best option is to search online for rental companies open to allowing sellers to live in the home after closing.

Our company House Heroes LLC buys houses and leases them back to you. If you’re interested in this arrangement, call us (954) 676-1846 or fill in our simple form.

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How Much Rent Will I Pay?

Leaseback and post-closing stay arrangements employ one of two methods for determining rent.

Landlords focus on the “holding costs” for short term tenancies, and charge market rents for long-term tenancies.

Holding Costs Calculation.

Holding costs are the sum of financial costs to own the property.

These costs include utilities, maintenance, taxes, insurance, financing payments, homeowners’ association dues, landscaping, and management fees.

Rent charged per month under the “holding cost” calculation equals the entirety of monthly anticipated costs. The landlord “breaks even” on the rent and holding costs.

Landlords only use the “holding cost” calculation for short term post-sale stays. The brief tenancy is not a rental investment – but a courtesy to the prior owner (or incentive/necessity to complete the sale). Landlords may also agree to a “break even” scenario when the tenancy off-sets costs while bridging to an investment strategy.

Market Rent Calculation.

calculating rent in post-closing stay
Buyers allowing “short” post-closing stays often calculate rent based on holding costs. Expect to be charged market rent to become a long-term tenant.

Landlords charge “market rent” for long-term tenancies.

As real estate investors, landlords seek to maximize the return on their cash investment. Charging the market rent accomplishes this (it is a good balance between rental cash flow and making sure the rental remains occupied by honest tenants).

There are four ways to learn the market ren in your areas:

  1. Search Online. Free websites show you the rents charged in the market. This includes Rentometer, RentBits, Padmapper, Zillow, Craig’s List, and Ziply. Simply type in your address or zip code and get instant estimates and review rental listings!
  2. Drive The Neighborhood. Some landlords don’t post their listings online. Drive through your neighborhood and look for “For Rent” signs. Call the phone number and ask the rent being charged.
  3. Consult with Local Landlords & Property Managers. Landlords and property managers charge the rent. They possess the “first-hand” knowledge of the current trends in market rents.
  4. Newspaper & Written Publications. Although print is considered “old school” and out of favor, it is an additional source of rental information.

Market rent adjusts based on the following: number of bedrooms, inclusion of utilities (electric, gas, water, internet, cable), pet allowances, bonus features like parking spots, yards, gym, storage, square footage, transportation access. You can also consider the “walkability score”, i.e., the proximity to local areas of interest.

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Example Documents

Developing a cursory understanding of real estate agreements is helpful for negotiating the purchase and sale, and leaseback, of your home.

When assessing purchase and sale agreements, give special attention to the following terms: purchase price, escrow deposit, inspection period, financing contingency, appraisal contingency, closing date, and the “additional terms” section.

Important lease terms include the term (years or months), monthly rent, security deposit, grace period, subletting policy, guest policy, and occupancy rules.

Here are some examples for review:

Real Estate Purchase & Sale Agreement (Florida). “As Is” Residential Contract For Sale and Purchase approved by the Florida Realtors and Florida Bar.

Real Estate Purchase & Sale Agreement (New Jersey). Standard Form of Real Estate Contract approved by the New Jersey Association of Realtors.

Real Estate Purchase & Sale Agreement (Texas). New Home Contract (Completed Construction) set forth by the Texas Real Estate Commission.

Residential Lease for Apartment or Unit In Multi-Family Rental Housing (Florida). Used solely for multi-family residential – not commercial, agricultural, or single-family properties.

Residential Lease for Single Family Home or Duplex (Florida). Term not exceeding one year and not applicable to properties with over two units.

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We Buy Houses (And Let You Stay In It)

Call Us (954) 676-1846 or Fill Out This Form For Your FAIR Offer.

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