Early Occupancy Agreement Template With Land Owner
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FAQ
What a use and occupancy agreement does is allow the homebuyer to move into the property prior to the closing date under certain agreed-upon terms and conditions. The clear benefit is that the buyer can avoid having to move twice (or more), and it provides them with a smoother post-closing transition into the new home.
The buyer might make this request because their home has already sold or their lease is up and they need a place to live. When a buyer requests to move into the property they're purchasing prior to closing is commonly referred to as early occupancy.
What Is Use and Occupancy (U&O)? The term use and occupancy (U&O) refers to a real estate agreement between two parties that allows one party to use and/or occupy a property before ownership is transferred from one side to the other.
The SIP form begins with an opportunity to attach this agreement with the RPA or another key agreement for the sale of the property. The SIP explains that ?the Addendum is intended to grant Seller a license to remain in possession of, and use, the Property after the Close of Escrow.? (C.A.R. Form SIP, Revised 12/17).
Even though early occupancy agreements are great for the buyer, they come with risks for the seller. In addition to all the risks a normal landlord would have, there is the additional risk of something going wrong with the buyer's mortgage and the buyer not being able to actually buy the house.