Looking at making my first multi-family purchase. What are some of the things I should I ask seller for? Security deposits, copy of leases, recipients for recent repairs?
Congratulations on your first MF deal! Look up estoppel agreement. I’m learning this stuff for myself as I have my first MF under contract as well.
First congratulations. Second, you are not very clear as to what you are asking.
Have you already made the deal and done your due diligence and want to know what the prior owner needs to transfer to you at time of sale?
Or are you still in due diligence mode and need to know what to ask the owner for so that you can properly evaluate the property / deal?
@Marcus Rembert Sounds like you are just in the initial stages of finding deals. If this is the case, then all you need to ask for right now is the OM, T12, and Rent Roll. Once you have it under contract then you will have an entire list of additional items you will need when entering the due diligence phase.
@Peter J Turner - to your knowledge, are estoppel agreements used in most markets? I have not heard of them much here in the Chicago market although that doesn't mean they aren't used....
@Michael Badin - Yes, I am in the due diligence phase and I'm pretty green..... and want to make sure I'm going about this properly in terms of the right questions to ask the current owner.
@Dan Handford I'm familiar with the T12 and Rent Roll, what's the OM? Also, any insight or a list you can share into the additional items I will need during the due diligence phase would be greatly appreciated.
Here is a link to an old Forum post with lots of good info on what you are looking for. Read through the post and you should find what you need.
@Marcus Rembert Generally you are getting to get an offering memorandum with a breakdown of income and expenses and give you an idea for the leases. Once under contract you begin the attorney review period and request to see the actual leases, verify vacant and occupied units, security deposits, any subsidy contracts, verify the actual expenses for the building, and preferably get a T12. You'll want to hire an attorney to help you through this process.
Is there perhaps a checklist anywhere or any way BP could add one?? I'd think that would be a popular resource, even if it was a pro feature.