Is it okay to move into a house you havent closed on yet?

Question

we are getting ready to move into a new house and our closing date was set for the end of the month. Now, 6 days before closing a lien "popped up" and has to be taken care of. The seller is paying it and trying to take care of paperwork and our closing has been postponed for almost two weeks.

We had planned on moving, closing, etc on the date given to us and had many things arranged. The seller told us we could move in at the original date, before closing.

Is this okay? Are there any legal minefields we should watch out for?

Here is some more details, according to my real estate agent:

the builders had a cabinet company working for them. Well, they were
not happy with the cabinet company and did not pay them. the cabinet
company put a lien on 2 or 3 houses, ours is one of them. A lien is a
financial claim on something, in our instance its the house. When the
house sells they would be able to collect a portion of the money for
what they were owed. However, this was a few years ago and they had
settled their differences (and were paid the money they were owed).
They just forgot to take the lien off of the builder's properties,
which brings us to this point. The builder is working on the paperwork
to get this lien taken off of the house.

Answer 1

Yes! Since you are still not the homewoner, he will charge you a daily rental fee unless he waives it...make sure you have him state in writing that you will ocupy the property before closing "rent free".

Answer 2

What happens if that lien can't be cleared? What is it for? Is it a lien against the current owners, like an IRS tax lien? Property taxes? Unpaid contractors? Or is it just some old paid mortgage that wasn't satisfied properly at the county?

It's exceedingly rare for someone to have a lien just "pop up". If they owe someone money, and it got so bad a lien had to be put on their home, they should darn well have known about it.

I'd want details. What is the lien? Who is owed? Does the seller indeed have the money to pay it? If so, why not just pay it at closing and close on time?

The reality is, the risks in an early move-in are worse for the seller. If he can't get rid of the lien, you're now tenants of his, and have tenant's rights, including full process of eviction. Meaning it's hard to get you out of the house quickly.

But, if you move in, and bang up the walls or cause any damage to the property, real or imagined, he could try to make you pay for those items, even if they weren't caused by you.

This is quite serious, and you should tread carefully. Don't move in without a written rental agreement. Do a walkthrough prior to moving in and itemize every last imperfection in the home to make sure it can't come back on you. Pictures of the problems would be good.

You might consider contacting a real estate attorney to advise you further, as there could be other issues I haven't thought of or seen firsthand with my clients. You might be able to make the seller pay for a hotel and storage, and any additional moving costs you incur, if you have to move stuff out, wait, then move stuff in.

PS, I'd be VERY concerned if this lien was for unpaid contractors. It can happen that even if you pay a contractor, if they stiff their subcontractors, the sub can slap a lien on the home and demand payment directly. It sucks, but that's how it works. And if there's one, there could be others...

Good luck.

Answer 3

I don't recommend moving into a house that has not closed yet. The lien on the title report is a construction lien and is the responsibility of the seller. If in fact this debt has been paid off the title company should be able to resolve the problem and issue a new title policy in a matter of hours, not weeks. You don't want to get yourself into a house that doesn't have a clean title. Get on the phone with your realtor and have them get to work to make this closing happen when it's supposed to.

Answer 4

Don't do it!

The Seller must clean up their mess. If you move in, it may become yours. In a very rare case, a Mechanics Lien could result in liquidating the house and you'd be out of luck. If the closing date is delayed because of the Seller's problems, you may be due to some sort of compensation. I'd talk to a RE attorney quickly.

Answer 5

The closing on our house came up so quickly we didn't have time to move. the buyer let us rent back the house at a daily rate for 4 days so that we had time to pack and move. Ask the seller if its ok. And put everything in writing. I think you need a rental agreement with the seller for those 2 weeks. Hope this helps. Congrats on your new home.

Answer 6

Well, just keep in mind that until the closing occurs the house is not technically yours and you could be asked to leave at any time. You also may want to get something in writing from the seller stating that it's ok with him/her that you move into the house before closing. You don't want that to come back and bite you in the butt. Talk to your realtor about it, too.

Answer 7

WEll the worst that could happen is the seller could change his mind and still have the option to keep the house...then you woulod just have to move out....but that is not likely to happen since they are so far into the process...good luck hope that dont happen to you

Answer 8

nicely he does sound like a candy guy. I study each thing and from that i can assert he's attracted to you and identity say he has emotions for you. He may be frightened of a few thing, not sure what. would have some thing to do with the way his previous relationship went and ended. i think of what you need to do is enable him understand youre attracted to him and with a bit of luck hell respond nicely to that.

Answer 9

You need to get the owner's OK in writing.