Contract Clauses #6: Post-Closing Occupancy

Whenever the Seller needs to remain in possession of the Property after closing, it is important to negotiate and settle the terms of this post-closing occupancy as soon as possible. Some issues to consider are: how long can the Seller remain, how much rent will be paid, will there be a security deposit and if yes, how much? We have created an excellent provision for you to use. It reads:

Seller shall have the option to remain in possession of the Property for a period of ________ days after closing, but no later than ________. During Seller’s period of post-closing occupancy, Seller shall pay all utilities, shall maintain fire and liability insurance, shall maintain the Property and shall pay daily rent [of $________] [equal to 1/30th of Purchaser’s entire monthly mortgage payment, including principal, interest, taxes and all insurance (even if not included in Purchaser’s monthly mortgage payment)]. The parties shall execute a Post-Closing Occupancy Agreement as agreed upon by the attorneys for both Seller and Purchaser which shall contain the above-stated terms and a $________ security deposit for damage and removal costs. The terms and conditions to be included in the Post Closing Possession Agreement referred to above may include terms and conditions in addition to those contained in this Paragraph as mutually agreed upon by the attorneys for the Parties acting in good faith.

Remember to choose only one rent provision – either a fixed amount or a calculation based on the Purchaser’s entire mortgage payment (PITI).

You can access this clause by clicking the “Open Clauses” tab at Paragraph 20 or on the Addendum form on the Instanet program.