Logistics of the lease agreement when purchasing an occupied unit
I am in the process of purchasing a duplex with one side occupied. The current tenant has a lease which began in January, and terminates in 2021, so I'll be inheriting that lease. The seller sent me a copy of the tenant's lease, but the confusing part is that the lease is signed only by the tenant and dated within the last 2 weeks. Is the seller expecting me to sign the lease, and return it to him, to forward onto the tenant?
What is a typical sequence of events in regard to signing a new copy of the lease with the current tenant? (I know I'm responsible for the tenant's lease as-is. Do I even need to sign the new lease, or is it just for my records?) Does the seller deliver it to the tenant after I've signed it? Or do I deliver it upon closing, and then notify the tenant that rent should be paid to me, instead of the address mentioned in the lease?
I know that's a lot of questions. Any help is appreciated. (I also know that typically these questions would be directed at my agent, but we don't have agents involved on this deal.)
Hey @Mark S., welcome to the BP community!
I will start this off with a bit of a disclosure. I am a REALTOR® but in GA so my knowledge on contract law will not necessarily apply to your state. I am also not a real estate attorney so your best bet here is to speak with one in your state.
Typically, when taking over a property with a tenant in place, the new landlord assumes the leases in place. There are exceptions such as if the tenant is willing to sign onto a new lease but this is their option. A signing of the old lease by the tenant and the new landlord (you) is not necessary, but could provide a good opportunity to ask the tenant if they would consider terminating the previous lease and signing a new one.
Usually, what a new landlord would do is simply have the tenants sign an estoppel saying that they understand and agree to the terms of the original lease. This ensures there have been no verbal or hand shake agreements since it was first signed. I have not heard of the new landlord needing to sign the original lease. Here in GA, lease terms are simply assumed by the new property owner.
Hope this helps a bit and please, feel free to message me anytime if you have other questions or just want to chat!
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Real Estate Agent Georgia (#401878)
- 404.737.0018
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> A signing of the old lease by the tenant and the new landlord (you) is not necessary
Thank you! This helps clear things up, and is in line with some other things I've read. Regarding the estoppel - great idea! That's something I'll discuss with my lawyer to hammer out.
Thanks for your input!
