Did you know... June 10, 2013

Buying A rental property?

What you need to ask for if you represent someone buying a property with a tenant in place?  The following should be requested as part of the buyer’s due diligence:

§         Lease and any addendums – the property is subject to the lease terms.  At the end of the lease or if a month-to-month rental agreement, terms can be changed with a 30 day notice.

§         Move in inspection report – the tenant cannot be charged for any damages unless there is a written move in inspection report.

§         Rent ledger – this will tell the buyer whether the tenant pays rent on time.

The following need to be transferred at closing:

§         Any deposits and pre-paid rent (last month’s rent).

§         Pro-rated rent for the month of closing.

§         Keys (easy to forget if buyer isn’t taking possession at closing).

§         Tenant contact information.

The buyer must notify the tenant in writing of the Washington State bank and branch where the deposit will be held in trust, where to mail rent and who to contact in case of a problem.

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