One of our investment clients recently asked us about some of the technical forms involved in selling their seven unit complex. While this client does have a manager on-site, he was still concerned about the procedures, paperwork and expectations for these forms.
Tenant Estoppel Certificate: This form just verifies that the tenant/landlord/manager/new buyer all agree on the stated monthly rent, security deposit, lease dates (if any) and ownership of any appliances. Normally the tenant is provided a copy once the property is going in to escrow and then it is signed by all other parties. In addition to the estoppels, landlords usually provide copies of any leases or rental agreements on the properties.
Profit & Loss Statements: These come in many forms as every landlord/manager will have their own way of accounting. Most are a simple one page sheet showing the rental income and expenses. The common sales contract will ask the seller to provide such a statement for the last 12 months, though we often get a calendar year statement or two years, since it is kept that way for tax purposes anyways. Sometimes the buyer may ask to see additional information such as utility bills or details on recent repairs, but this is requested after the basic report is provided.
Do you have questions about preparing to sell your income property? From the paperwork, to negotiations, to wrapping up the deal so you can move on, Toering and Team assists our clients everyday. If you would like to discuss how we can help, please give us a call.
- Josh Toering, REALTOR
Charlemagne Int'l Properties
(310) 525-9440
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