Rental Property Investor · Phoenix, AZ · Member since 2015 · 224 posts · 50 votes
When purchasing a rental property that is currently rented, what is the best way to make sure you get your pro-rated rents and deposits? I thought it was something done in escrow but according to my lender, there was a regulation change back in October and that is no longer the case. He said that those items are now interpreted as kick backs and that is not allowed on a loan.
I'm closing on my first multifamily tomorrow and I'm waiting on the seller to send to me the rents, and for their PM to send my PM the deposits. I just feel uneasy about having to rely on these people to send me items after the property has been transferred and closed.
Investor · Menomonee Falls, WI · Member since 2014 · 54 posts · 16 votes
10y
@Ryan Moore, the regulation I believe they are referring to is TRID and I don't believe TRID (TILA RESPA Intergrated Disclosure Rule) prevents them from putting the security deposits and pro-rated rents on the CD (Closing Disclosure), I think the problem is they don't want to put them in because they are technically transferring outside of the loan (i.e. meaning it is not a condition of financing). If that is the case, then you may just be stuck with waiting to sign until they transfer the funds. However, I can't stress enough that you should wait until their transferred before signing.