It is soooo exciting to be coming down the home stretch in purchasing your Northeast PA vacation home…negotiations are done & a price is agreed upon…home inspection issues have been resolved, and you’ve paid your 2nd deposit. The sellers have all but moved on with their lives and are merely waiting for the final paperwork to end their chapter and your chapter in this home in the Poconos will begin.
The house is all but yours, right?
You make an appointment with your agent to get into the house one more time. You want to measure for curtains and blinds. You want to look again and see how you will arrange your living room furniture. You know the sellers have taken the personal items they want from the home and are leaving a stockpile of goodies for you to sort through and decide what to keep, what to donate. Then there is the problem of getting out of your rental on time….the closing on your house is dangerously close to the end of your lease….you have work responsibilities, kid stuff to attend to….wow. You have so much to do, you have no idea how you’re going to get it all done in time.
While you are there, you happen to notice a spare key hanging in the garage. What could be the harm in picking up that key? You are, after all, ready to close on the home in a couple of weeks. It will be yours soon enough. You don’t want to keep pestering the agent in case you want to get back in the home for something, maybe to drop off a few boxes of “stuff” to get a jump-start on moving. After all,
the agent is busy.
Should you pick up the key and then start your moving in a little early? After all, you are getting new carpets, and you want to get them installed right away. Maybe you can have the carpet guys come over and take their measurements. You wanted to replace that bathroom vanity; the contractor has a break in his schedule to look at the job and give you an estimate. It would make things so much easier to get them done and off your checklist early without bothering everyone else.
Not to mention, you could start enjoying Lake Wallenpaupack a lot sooner, if you had some of this moving finished ahead of time!
STOP. Do not do what seems like a harmless way to make your life easier.
You will be committing a criminal act. You do not own the house, the seller does, until the settlement occurs.
To enter the home without the seller’s express permission, even if you are buying it in a couple of weeks, is trespassing, and it is illegal!
To pocket a key that does not belong to you, without permission, is illegal.
If you put items into the house prior to settlement, they are at risk – what happens if there is a fire, a break-in, a natural disaster or burst pipes that flood the house? Your property will not be protected by homeowner insurance.
Likewise, what if you or someone you allow onto the property gets hurt or causes damage to the seller’s property…just imagine the mess this could create...then something totally unexpected happens: your mortgage is not approved for some reason and you can’t buy the house after all...suddenly what seemed like a great idea to save time has turned into a big, ugly, hairy mess.
Of course an option is to sign what we call a “hold harmless” agreement; a document that says the parties will not hold each other responsible for damage or loss. I advise my clients to avoid situations like this unless absolutely necessary. It is preferable for all involved to wait until settlement before taking possession of the home; the sellers are released from responsibility for what happens on the property, and the buyer’s homeowner insurance will be in place to protect their personal belongings.
ADDED: Thanks to some feedback on Google+, I heard a few horror stories that came from buyers pretending the house is theirs before it actually is…one involved a buyer performing nearly $8,000 worth of repairs in order to satisfy a lender. Problem was, the seller decided to just walk away from the deal. Then there were some buyers who didn’t want to shell out extra $$$ for a storage unit and asked to store their stuff in the house till settlement. After settlement, they discovered that some high-end electronic equipment was missing. Of course, the seller knew nothing about it.
What do you think? Is it a good idea for a buyer to start taking possession of a property prior to settlement?