Selling rental house to tenants

7 Replies

I just sold my rental to the tenants who are living there. Escrow has closed and the tenant sent me a message about a refund for partial rent (they paid for the full month- but escrow closed on the 12th) and they asked about the refund of the security deposit.

I obviously did not do a move out walk through, as they did not move.  They live there.  What are the rules for refunding deposit without walk through in this situation?  Rental house is located in California

Thanks!

Agreed with the others, it should have been on the closing statement. Remember, the security deposit is the tenant’s money that you’re just holding in escrow. It’s never your money.

Double check the closing statement to make sure it isn’t on there.  If not, send them their check ASAP.

I think I disagree that they should get any additional funds, although I'm not a lawyer, no legal advice.  I would think 1) they agreed to the written terms of the contract, that had they wanted any of their funds credited or returned along with the purchase, that should have been clearly stated in the contract, and that 2) both parties likely signed something at closing stating that the terms agreed upon at settlement represent the full agreement, that there are no surviving outstanding issues.  I'd read through your closing paperwork, as if you both signed at settlement that there is nothing outstanding, this represents the full agreement, then they should not be  asking for further credits after the fact.  I would think it perfectly reasonable that you may have agreed to the purchase price based on the consideration that they weren't asking for rent or deposit to be returned in their offer, and you may have negotiated a higher price if that was a condition of their offer.