What does possession settlement mean?

What does possession settlement mean?

Subject to Home Choice
Definition of Possession: Subject to Home Choice This term is used by sellers in the original listing agreement to let potential buyers know that the sellers need to buy a new home before the buyer can take possession of the home for sale.

What happens if settlement does not occur?

Delayed Settlement Penalties If the buyer is unable to settle on settlement date, the seller can choose to terminate the contract, retain the deposit and may sue the buyer for damages and/or specific performance. If the Seller agrees to extend the settlement date, they can also charge penalty interest.

What happens if sellers don’t move out?

If the seller does not vacate on the appointed date, or leave the home damaged in some way, then the money held in escrow can be given to the buyer as a penalty or to fix the property. You may be able to sue the seller and recover attorney fees as well.

How does possession prior work at residential settlements?

One of the staff members at Residential Settlements is currently studying for their conveyancing license, and as they have discovered, possession prior is not as simple as it initially seems. When a buyer takes possession of a property before settlement has occurred, the contract becomes a terms contract.

What to do if you are given possession prior?

To avoid these risks and consequences, it’s best to use possession prior only as a last resort. If the buyer is given possession prior, it’s up to both the agent and the settlement agent to inform them of the risks and advise them to complete their due diligence.

What are the risks of granting possession prior?

Granting possession prior can help to smooth out sticky situations before settlement, but it should be used sparingly, because there are serious risks attached. Often, buyers are keen to get into their new home.

What can cause a property to be delayed in settlement?

When you buy or sell property, in the best-case scenario everything goes to plan and settlement occurs on the agreed date. Unfortunately, that doesn’t always occur. From financial problems to simply changing their minds, there are several factors that can prompt the buyer or seller to delay settlement.

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