Posted by stan on February 24, 2001 at 23:03:54:
in your purchase agreement you need a clause that conveys all prorations to the buyer at time of closing then those things such as deposits rents etc are passed on to the buyer at closing
Inaccurate Data? - Posted by Tim
Posted by Tim on February 22, 2001 at 12:14:47:
Could someone please explain the following excerpt I read from Landlord.com. It is trying to explain to a perspective buyer of a multi-unit property some of the things they need to be prepared for:
DEPOSITS
You might consider this to be a part of the tenant records, and it is, but this is a dollar figure that can be a surprise to the uninitiated. When you are ready to sign all the papers at the title company or lawyer’s office, you will, as buyer, have to pay the seller for all the security and other deposits he is holding. On a large complex that can amount to many thousands of dollars. For a duplex or triplex it could still be $2,000 to $3,000. Factor that into your estimate of closing costs at the beginning of your consideration of a property.
Maybe I missed something when I went through the CS course but why would the buyer have to pay for the deposits of the tenants to the seller. Shouldn’t those deposits (I’m assuming he’s referring to last months rent and security deposit) be given to the perspective buyer? It’s not the seller’s money, it belongs to, in essence, the tenants. Did I miss something?
Any thoughts would be greatly appreciated.