What is possession?

In a real estate sale, **possession** refers to the moment when the buyer takes physical control and occupancy of the property. It is distinct from the closing, which is when the legal transfer of ownership (title) takes place. Possession typically happens after closing but can occur at different times depending on the agreement between the buyer and seller.

Here are the common types of possession in real estate transactions:

1. **Possession at Closing**

   - **Description**: The most common arrangement, where the buyer takes possession of the property immediately after the closing process is complete, typically the same day.

   - **Process**: Once the paperwork is signed and the funds are transferred, the buyer receives the keys and can move in.

2. **Delayed Possession**

   - **Description**: The seller remains in the property for a certain period after the closing, often agreed upon in advance.

   - **Reasons for Delayed Possession**:

     - The seller needs more time to move out.

     - The seller may be waiting for their next home to be ready.

   - **Terms**: A "post-closing occupancy agreement" (or rent-back agreement) might be in place, allowing the seller to stay for a set period. The seller may pay rent to the buyer during this time.

3. **Early Possession**

   - **Description**: The buyer takes possession of the property before the actual closing date, usually through a formal agreement.

   - **Reasons for Early Possession**:

      - The buyer needs to move in early due to specific circumstances.

     - The seller has already vacated the property.

   - **Terms**: This may involve an "early possession agreement," where the buyer takes responsibility for the property before legally owning it. This comes with risks, so legal agreements are crucial.

4. **Possession Upon Final Walkthrough**

   - **Description**: In some cases, possession happens after the buyer performs a final walkthrough to confirm the property is in the agreed-upon condition. If everything is satisfactory, possession occurs at or just after closing.

Legal Considerations:

- **Possession Date**: This should be clearly stated in the purchase agreement.

- **Responsibility for Property**: Until possession is officially transferred, the seller remains responsible for property maintenance, utilities, and any damages.

- **Rent-Back Agreements**: If the seller stays in the home after closing, agreements should specify rent, insurance, and liability terms.

In summary, **possession** is the point at which the buyer can physically move into or take control of the property, which may or may not coincide with the legal transfer of ownership (closing). The specifics of possession are negotiated in the purchase contract.

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