Time of Possession, Minnesota Style

Dear Pat,
What’s the deal around here, giving a full day after closing for the seller to move out?  Where we come from, the seller has to be out of the house by the time he signs the closing papers.  We’re asking because the sellers made us give them a day extra possession after closing, even though we’ll be responsible that day for mortgage, insurance and taxes.  Is this normal “Minnesota Nice” (with us being the nice), or were we
---Hoodwinked

Dear Hoodwinkies,
By “made us give them” I assume you mean that the sellers accepted your offer, with the condition that possession be given one day after closing.  This is indeed common in Minnesota, although our standard purchase agreement allows for any date or specific time to be agreed upon, from immediate possession to weeks, or even months, after the closing.  So you weren’t hoodwinked, you simply didn’t get everything you wanted in the negotiation.  Dot’s juste bissiness, da vay vee do it here in Mi-nne-so-ta.  But while we’re on the subject, it’s worth pointing out to all prospective buyers and sellers that there are good reasons to be careful when negotiating time of possession.

Let’s look at a few of the timing considerations regarding possession.  Sellers may want to ensure that the house they’re buying will be available for occupancy before they move out of the house they’re selling, so it’s to their advantage to ask for the extra day.  Often for first time buyers it’s little hardship to accommodate them; unless, of course, their rental agreement requires them to leave on the same day picked for closing.  In all cases it’s best to specify an hour for possession, such as “2PM day after closing” so everyone is clear. 

When sellers need more than a day or two, they are typically required to sign a rent back agreement, and to pay a daily rental equal to the buyer’s mortgage costs.  Sometimes they’re asked to give a damage deposit (although sellers can be insulted by this, after they’ve worked hard to maintain a house and to sell it).  It’s important to note that a longer-term arrangement such as this should be negotiated at the time of sale—last minute surprises could easily result in sellers hunting for storage lockers and extended-stay hotels. 

Obviously there needs to be trust between the parties and their agents when matters of possession present last-minute challenges.  If the moving van is delayed, or the up-line closing didn’t happen on time, everybody has to scramble and compromise.  This is when sellers and buyers fare much better if they go to closing as cooperative parties rather than adversaries.  So my advice to you, Hoodwinkies, is to put on your best smile and make Minnesota Nice!