I'm working through some of the final contingencies for my first owner occupied duplex deal. I had a lawyer review a tenant buyout contract (needed to buy one tenant out so I could occupy) and during that discussion, the lawyer suggested that I sign an Assignment of Lease with the current lessor - making the lease transfer bulletproof in the event of eviction proceedings. One of the specific items that was suggested to be included in the assignment was a clause indemnifying me from any claims/damages/expenses/liabilities that occurred prior to me purchasing the property and the leases being assigned to me. The example he gave was: pipe burst in the winter - landlord couldn't/wouldnt get to it in time - tenant paid to fix it - landlord wouldn't reimburse - tenant sues me (the new lessor) for the damages.
I'm on the fence whether this is really necessary or maybe just some FUD.
It protects you, why would You question it?
Let me get this straight. You pay a professional somebody to advise you, and then choose to ignore that advice and instead look to the nobodies on the internet for free advice? You're kidding I hope ...
The trolls are in force tonight...
I'm asking a community of real estate investors to weigh in based on their experiences - this will help me make a well informed decision on the route that I will take.
Steve, do you have any experience with a lease assignment that you could offer some insight on?
@Brad Bamm , I have bought properties subject to existing leases, but never with an indemnity clause. It appears the indemnity clause would do nothing but benefit you. If offered for free yes take it.
Oh one more thing, the guy you suggested is a troll is a VERY intelligent investor. While the advice was free and had a little sting, it was correct and he took the time to answer. To him and me the answer was very obvious. Good luck on your deal.
@Jerry - thanks for the input and the insight on the previous posts.
I am pretty sure I would do what my legal counsel advised in this case. Would also suggest that you keep that lawyer to work on future deals.
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