Seller Rents After Closing

Recently I closed on a great deal. My neighbor sold me his 3 family home for a really good price. A whole different story but for now I would like to focus on them staying as a tenant until they closed on their new home.

During the negotiation phase my neighbor asked if they can stay until they close on their new condo. I agreed because I really wanted to do anything to make this deal close.

We agreed to terms. The monthly rent and something their attorney threw in which was a really good idea was after two months a very absorbent daily rate to help put this deal to a final rest.

At the closing table I told the seller that I wanted the basement apartment, backyard and garage right away. The attorney asked him to turn the keys over to me. He didn't have them, so I kept things pretty formal and said no problem, we will work it. So a day or two after closing passed and nothing was getting emptied out. So I approached him and asked him to turn over the areas I requested.

He was under the impression that I wanted all his stuff. I mean there were some good tools and a few items that could be used but I figured if I started taking some of the things and not others then he would expect me to be responsible for everything.

So the lack of his interest to give me the areas I wanted just made me go into demo mode and start throwing everything out to the garbage.

"Oh you don't want that futon? I'd hate to throw it out"

I tried to put myself in his shoes and really tried to be considerate. But he had 650 grand of my money and I wanted to start renting apartments.

Aside from him not turning over areas there was the little issue of the yard. This yard happens to be right next to my yard and I wanted to use the pool in his yard that came with the house instead of erecting a pool in my yard.

There was also his dog that he didn't walk on a regular basis. So there were land minds all over the place. I'm sure you can imagine how much fun it is to run over dog doo with a lawn mower. I asked him on several occasions to walk his dog and not let it out in the yard.

I'm sure it's very difficult giving up your home after bringing up your family and many areas of nostalgia that you had to all of a sudden give up. But again he does have my money and we did have an agreement.

So now here I am, just collected the second months rent and now in 30 days he will be paying me by the day if it gets to that point. I made it very clear to him that he has to broom sweep the area he is renting from me and has to clean out all of the furniture no exceptions. I asked him to start throwing out things sooner than later instead of leaving everything in front of the house the day he leaves. So until the day he leaves I have to deal with the dog, the pool parties and the total disregard to the fact that he has my house and my money.

So what I took from this is that if you rent to the seller and are going to take over areas of the property be very clear at the closing table and establish monetary consequences if expectations aren't met. The only saving grace I have is if he is not completely out after 60 days he will be obligated to pay me daily $250 until he's done.

The upside, when all is said and done the property will clear a nice profit after all expenses are paid.

A small bumpy road to deal with that will pay off in the long run.