6 reasons buyers should never move in before closing

Cara Ameer, a top-producing broker associate from Northeast Florida, writes about working with buyers and sellers, sticky situations and real estate marketing in her regular Inman column that publishes every other Wednesday.

With many buyers, especially those who’ve purchased a home that is vacant, the following question invariably comes up: “Would it be possible for us to put just a few things in the house right before closing?”

And why shouldn’t they ask, right? Moving a couple things in will certainly help save them time. It’ll cut down on the number of trips they have to make with a moving truck, and if they can get a jumpstart on moving before closing day, they won’t have to take as much time off of work.

It sounds harmless enough, but as any seasoned real estate agent knows, there are never “just a few” things that buyers want to move in. One or two boxes usually turns into an entire houseful of belongings.

Even worse, if the seller is not living in the house, the buyers might ask to take possession a few days or weeks before closing. Their lease is up, and they don’t have anywhere to go, the closing date cannot be moved due to lending guidelines, and besides, it’s only a week or two.

You might want to say “OK,” but allowing a buyer to move in anything, let alone themselves, prior to closing is a recipe for disaster and unnecessary risk.

Here are six reasons agents should never allow buyers to move any belongings into their new home or have access before they legally own it.

1. Murphy’s law

As just about everything in real estate goes, if it can go wrong — it will. The mere moment that a buyer’s belongings are placed inside a seller’s home, they run the risk of disappearing in the middle of the night, somehow walking out the door or will mysteriously get damaged.

And if a buyer ends up moving in? Rest assured that something will break, leak or malfunction that was just fine the day before, and of course, functioned as it should have during the home inspection.

2. Liability

Speaking of Murphy’s law, without any written pre-occupancy or lease agreement in place, as well as proper insurance coverage established on behalf of both the buyer and the seller, the seller becomes liable for the buyer’s belongings as well as any damage that may occur as a result of those things being moved in.

What happens when there are scratches on the floor, gouges in the walls and the ice maker gets jammed up? The sellers now have an entirely different problem on their hands.

Never mind things like floods or fires that could occur. An entire book could be written on all of the “what-ifs” that go along with allowing a buyer to move in before they officially own their home.

3. The never-ending walkthrough

With a buyer now in possession of their soon-to-be new home, the scenario becomes ripe for the buyer to scrutinize the property in detail every day. As they check, recheck, test and operate each component in the house, they are sure to find fault with one or many things.

They are also likely to notice things they never did before, no matter how minor, that could result in trying to renegotiate issues that were never raised as a result of inspections or repairs that may have already been made and checked.

4. Improvements and repairs

Once a buyer has access to their soon-to-be new home, it’s hard to hold them back from making improvements or changes. Now you have buyers pouring money into a home that they don’t yet own and a seller who is liable for everyone and everything that is involved in those improvements — a recipe for disaster.

Painting may seem innocent enough, but what happens when the paint spills all over, or the contractor who was hired falls off a ladder or causes other damage?

Or the lawn guy, hired by the buyers, accidentally hits the sprinkler heads with the weed whacker, and the water bill skyrockets.

The list of what-if scenarios is endless.

5. Buyer’s remorse

The potential is ripe for buyers to change their mind about the home once they’re in it. Maybe they were already having a bit of cold feet. Or once they moved in, they start to look for reasons not to like the house.

Perhaps another property has come on the market or one has had a significant price reduction that has caught their attention.

In any case, the possibility exists that they may decide not to close and risk losing their binder deposit.

Again, the seller is left with a precarious situation on their hands, and this has cost the seller way more than you can put a price on. Often, far more than the buyer’s binder deposit is lost, including the marketing costs, time and days on market.

6. Closing problems

Back to Murphy’s law being alive and well; what if the unthinkable happens and the buyer is denied a loan and can no longer close?

The seller will want to get the home back on the market ASAP and won’t want the prior buyer to remain in the house. All sorts of complications can stem from this situation as the buyer is in possession without a lease agreement or any stipulations in respect to when and how they must vacate.

The buyer might leave the home in less than desirable condition, and the seller is stuck having to make repairs and replace items as well as have it cleaned and essentially reprepped for sale.

There are also a myriad of details to deal with such as utilities being transferred, mail delivery as well as now making arrangements for lawn care, landscaping and pool that might have been done by the buyers.

In any case, allowing a buyer to move in prior to closing can be both a legal and a real estate nightmare.

If there’s no way around it for some unknown reason, the buyer and seller will need to engage attorneys to flesh out all the details before handing over the keys. But certainly, a seller should never let a buyer move into a home without any detailed lease agreement that addresses the variety of what-if scenarios that can and often will arise.