You might contact a RE lawyer to protect yourself. It appears they haven't much money (like for down payment) and once you get them in, it will take a act of congress and lots of money to get them out. Are you leasing or renting--get legal advice first.

My suggestion since you want to lease back from them--visit a couple of lender websites to determine current interest rates and often lender sites will have a mortgage calculator. What would someone purchasing your home pay typically for the mortgage, insurance, taxes? That might be a starting point.

BTW---don't let the fact that they are cash buyers sway you in negotiations. Everyone is a "cash" buyer at closing.

Usually the rent equals the amount of the mortgage payment, right?

I don't think this is accurate. Fair market rent is not based on the financing (if any) of the specific home.

If I put 50% down on a house that doesn't mean I'd rent it for half of what someone who put 0% down would.

Certainly I'd want a positive cash flow, but there's more to it than that: I'd want to take into account taxes, financial risk, possible repair costs, time and aggravation of dealing with a rental, interest I would earn on the equity if I invested it otherwise.

I think it's pretty clear that it'd be good for you to sell quickly with a leaseback to you until you're ready to move. What do the buyers get out of letting you leaseback? Do they need cash payments? Do they need credit towards closing costs? Do they need a lower price?

As for determining a fair lease price, I'd check the real estate listings--what do houses like yours rent for? Use *that* as a starting point. That doesn't mean that a leaseback and an ordinary lease rental would be the same amount, but it would give you an idea of what you really are negotiating.

--Beth

Actually, we were in the exact same situation as the OP when we sold our elderly mother's home. We sold FSBO and passed on 1/2 the savings from not using an agent to the buyers. Mom needed a 20-day rent back and our buyers were cash buyers (imagine!). We didn't know how open the buyers would be to a post occupancy clause. We wanted to be as fair as possible so we pretended we knew nothing of their financial situation. Our lawyer drafted the clause:

1. We calculated a per diem based on what their PITI payment would be if they were purchasing with a 20% downpayment, 30 Yr FRM at prevailing interest rates.
2. We also offered a post-settlement walk through upon move-out and offered to escrow $5000 to cover any damages to the property that might occur while vacating or that were hidden by furniture etc.
3. We had purchased a Home Warranty for them to cover any unexpected appliance repairs and converted Mom's homeowners policy to a renters' policy covering both contents and personal liability.
4. We, also, offered a $1500 cleaning allowance. Moving Mom out of her home of 40 years into a 2 BR apartment was back-breaking work. Cleaning it to our standards seemed more than we could handle, hence, the cleaning allowance. Of course, we cleaned like dogs anyway.....

They were pleased as punch...we later learned that we had overcome any objection right up front. When we moved out, they signed the escrow release without blinking and, boy, all parties involved sure loved that cleaning allowance.

I let the previous owners rent my house for two months after closing while they were finishing building their new house. I had them pay my full mortgage payment including taxes and insurance. When they balked at the high payments, my agent assured them that this was customary for the area. They actually stayed an extra week, which I didn't charge them for since everything went so smoothly. Also, this was all specified in the sales contract, so there were no surprizes.

"Usually the rent equals the amount of the mortgage payment, right?

I don't think this is accurate. Fair market rent is not based on the financing (if any) of the specific home."

You are not renting.
You are holding over as a tennant at sufferance.
You do not have (or want) an actual lease.
A very common practice is to cover the PITI for the new buyer at whatever rate they are finincing.
You pay more if they put down less, less if they put down more. If they will have no mortgage you will just have to negotiate.
The only cost to them is then 'opportunity cost' on the down payment.
For tax purposes it comes out a wash, and sometimes does not even have to be declared (less than 2 weeks or so, but check the ORS site).

Well this might be a moot point since an offer hasn't materialized yet. If one does, we have decided to offer the current rate of comparable homes that are for rent.

Thanks for the opinions!