To be able to clearly understand the clauses of a lease agreement it is very important to understand what is an estoppel certificate
.
An estoppel certificate is a letter that carefully summarizes the most important and factual conditions of a lease policy. It also serves the purpose of defining the kind of relationship a tenant and his/her landlord has and outlines the details of the tenant’s rights.
A tenant estoppel letter is signed by the current tenants living in a rental property. The landlord of that property may appeal to its tenants to sign this certificate if he/she is looking forward to taking a loan on the leased property. They may also do so if the owner of the leased property intends to sell off the property and is interested in knowing the status of ongoing leases on the property.
When a tenant knows what are estoppel certificates
they recognize that they have the right to either confirm or reject the information presented by the landlord in the certificate if they find any information to not be true.
Benefits of an Estoppel Certificate:Apart from understanding what is an estoppel certificate,
it is also very critical to fathom its benefits.
It serves the purpose of due diligence for the buyer. It ensures the buyer that the terms of the lease and all the clauses mentioned are true.
It contains crucial information regarding any ongoing legal claims against the landlord. So, the buyer has a clear idea of whether to invest in the property or not.
It also contains the information regarding the start date and end date of the lease on the property. The contact details of the tenants and the landlord are also entailed in it. All of this information helps the buyer in making a worthy choice.
Now that we know what is an estoppel certificate,
we can make out that if all the information presented in an estoppel certificate is true, there are no risks involved for any party. It is crucial to thoroughly go through the letter before signing it. Because due diligence ultimately pays off.
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What is an Estoppel Certificate?
Neha
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3 Year
2022-03-22T17:02:23+00:00 2022-03-22T17:11:33+00:00Comment
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