5. No rental contract created: An important provision for the seller is that the use and occupancy contract clearly indicates that, although the buyer occupies the property – by storing objects and/or dwelling in the house – there is no owner-tenant relationship. Buyers should expect that there is a particular language that states that the contract is not a rental contract nor there is an established legal lease, so the home buyer who has and use the premises has no rights, including tenant rights. The agreement often stipulates that the use and occupancy agreement is only a “licence” for the use and occupancy of the premises. It is important that you read your lease carefully before signing it. If you have any doubts, please contact one of the following rental support services for the council. What further complicates matters is that an “occupancy and occupancy licence” between the buyer and the seller “is revocable according to the will of the landowner and that the licensee`s right to occupy the premises is [revocable] at any time by the registration or claim of the owner of the property.” Neither party has a lot of security under a “U-O” license, because the taker can leave at any time and the new owner can revoke the license at any time by requiring possession. Why would the parties accept such an agreement, which is essentially a temporary invitation to use the land, but does not retain the right to own the land exclusively? As BJ explained, to facilitate relatively complicated or difficult transactions, or simply to facilitate the buyer or seller. Despite the relatively volatile legal nature of the U-O licence, the granting of a U-O licence in a real estate transaction is often useful to the parties because of the goodwill generated by common objectives and positive communication between the parties. There is also a so-called post-occupancy agreement that allows the seller to continue living in the property even after the sale.
It`s like a back rental. However, for the purpose of this hack, we consider someone who occupies a property before owning the property (without using standard rental). Whenever a buyer seeks a use and occupancy agreement, the buyer should in any case discuss the pros and cons of such an agreement with his buyer representative and discuss the details of the agreement with his real estate lawyer before signing anything. Just like fiduciary holdbacks, which can benefit either a buyer or a seller, use and occupation do so for the most part.