Is Your Seller Not Moved Out After The Closing?

Once you purchase a home, the last thing you anticipate is the prior owner not being moved out once you have closed on your mortgage and are ready to move in. The first thing you should know is there are ways to prevent this problem prior to closing on your mortgage. When drawing up a purchase and sale agreement, it is possible to include clauses that cover:

• Moving out date: Generally speaking, it is a good idea to include a date at least 2 days prior to your anticipated closing and request an inspection of the property to ensure compliance
• Penalties for not vacating: Clauses in the purchase and sale agreement can explain what monetary penalties the seller will face for not vacating the property
• Legal actions: Buyers have the right to include language that explains what legal actions they may take if the seller fails to vacate the property along with language explaining the seller will be responsible for the legal costs

While this may be helpful before you close on your property, occasionally buyers who have already closed may not have had these clauses in their purchase and sale agreement and still need to proceed to get the seller out of the home so they are able to move in. The legal process for this is very similar to the process a landlord would use to evict a tenant from a Pennsylvania property.

What To Do When The HoldOver Seller Won’t Move

Under normal circumstances, sellers would be moved from the property prior to closing. However, when they do not move, the term that is commonly used is “holdover seller”. Basically it means the new buyer is unable to take possession of the premises they purchased because the seller has refused to leave. While it may be appropriate to speak with the seller and negotiate an equitable solution, there may be cases where an agreeable resolution cannot be reached. When this occurs, the buyer may be able to take legal action.  The legal action in this case would be much the same as a landlord/tenant dispute and would be handled under the Pennsylvania’s Landlord and Tenant Act, specifically the section known as “trespasser in possession”.

As a property owner, you will need to seek the guidance of an attorney who is well-versed in real estate law in order to lodge proceedings against the seller. During the time when the seller owns the property, you will also have to determine who is legally responsible for maintaining property and casualty insurance, whether or not they will be responsible for payment of rent (or your mortgage), and other financial considerations. These are important considerations that may have a negative impact on you, as the new buyer, financially.

The Consequences Of A Holdover Seller

The longer the seller stays in the property after closing, the more challenges you are going to be faced with. Keep in mind, the process for removing them from the property is exactly the same as a landlord evicting a tenant.  Your legal rights include securing a reasonable rent, getting reimbursed for any damages that might be caused while they are residing in the property and may also include any financial expenses you incurred while staying someplace while waiting for them to move out. The court may also require the holdover seller to pay your legal expenses for getting them out of the home.

The legal process for removing a holdover seller can be very complex and time-consuming and any mistakes that are made can cost you additional money and time.  You need a strong advocate on your side to protect your rights. You purchased a property in good faith and the seller does not have a legal right to continue residing in the property.