Many first-time homebuyers who are renting get into problems with their lease. They make an offer on a home, forgetting that they still have several months left to go on their lease. Sometimes, there’s a stiff penalty when you break a lease. Other times, you just forfeit your deposit or the landlord may hold you to the balance left on the lease. In one particular situation, a young couple made an offer on a home with a $1,000 deposit that was subject to mortgage approval only. When they informed their landlord that they were moving, he politely informed them they had three months left on their lease. They could move out, but he expected a check for the three months or $2,700, or he would enforce the terms in court. In the end, the homebuyers couldn’t cover both the down payment and the remaining lease payments, so they lost both the house and their $1,000 deposit. The lesson learned is that if you’re renting, read your lease agreement carefully. If in doubt about the terms, talk to an attorney. In another similar lease situation, rather than have the deal fall through, the sellers renegotiated the purchase agreement. They paid two months of the buyers’ remaining rent and upped the price to cover the third one. It was a slow market, and the sellers felt that giving the buyers a concession would be cheaper than putting their home back on the market. Luckily, these sellers took a pragmatic approach to getting their home sold.
To avoid this problem, don’t sign a year or six-month lease and then start house hunting. Sellers are usually reluctant to take their home off the market for more than 30 days. When you’re seriously ready to buy and your lease is ready to expire, see if your landlord will extend on a month-to-month arrangement with a 30-day notice.
No comments:
Post a Comment