Updated over 8 years ago on . Most recent reply
Deposit Question, Buy House with Tenants
Im purchasing a duplex that has existing tenants. They are currently on a month to month lease with old landlord. When we close on home in 2 weeks i will do some basic improvements around them that has been negligent and raise there rent about 10% which they are ok with. They both said they have given the current landlord a $300 security deposit. I obviously either want to get that money from old landlord (because im new owner) or he pay it back to them.... what should i do here or what is standard operating procedure? What i dont want to happen is when/if they move out and if they deserve security deposit back i dont have to pay out my pocket money that i never had from them. Thx
Most Popular Reply
@Brandon Becsi Have you seen their old lease from the Seller? That will answer a lot of questions and give you something to work with until you get them to sign your lease.
After that I'd have the funds credited in the closing. Get the seller and the closing attorney on the same page before hand though.
Once you close you'll need to segregate those funds in a special trust account. Look into your state law for the specifics.