seller signed new (lower) rent lease before closing

5 Replies

Hello, I am under contract for my first duplex. After going through the initial due diligence period we are now waiting on the appraisal and then we are cleared to close. I went by the unit yesterday to speak with the seller on a few things and was informed that one of the tentants had signed a new lease and the rent was for less than what was disclosed before we made our offer. I am curious if that is legal or if the seller has violated the terms of the agreement.

@Greg Dickerson This is my first purchase and it was off market. I received the rent rolls and leases which had moved from yearly to month-to-month since the tenants are long term. They were concerned upon sale I would come in and raise rents so the current owner signed one to a new year long lease at a lower rent amount than the lease I was given. What type of clause should I have written? Thanks

Originally posted by @Chris Matheson :

@Greg Dickerson This is my first purchase and it was off market. I received the rent rolls and leases which had moved from yearly to month-to-month since the tenants are long term. They were concerned upon sale I would come in and raise rents so the current owner signed one to a new year long lease at a lower rent amount than the lease I was given. What type of clause should I have written? Thanks

You really need to discuss this with your attorney as every state is a little different but generally the clause state the owner will not renew, extend or enter into any new leases while you are under contract.

If your contract does not address anything having to do with the tenants leases, then the seller can do with their property as they wish while they still own it.