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Posted by
Zhaoqi Li

A interesting question regarding transaction with tenant

Hi, so at closing, seller would give buyer tenant's deposit, and prorated rent for the month of closing. Here is my question, can seller prorate and deduct the cost of finding tenant (one month rent) from the prorated rent and deposit. please share your thoughts

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REALTORS®
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A interesting question regarding transaction with tenant

By Zhaoqi Li   
Posted on May 12, 2022 in Topic: General
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Hi, so at closing, seller would give buyer tenant's deposit, and prorated rent for the month of closing. Here is my question, can seller prorate and deduct the cost of finding tenant (one month rent) from the prorated rent and deposit. please share your thoughts
Status: Open
Viewed: 471
Asked by: REALTORS®
Posted: 2 weeks ago
Topic: General
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Bronze
Christie Walker
about 2 weeks ago
I wouldn’t assume they should or could deduct the cost of finding a tenant from the deposit or prorated rent. That’s just the cost of doing business. You can always try to negotiate those fees into the sales price if they feel it’s necessary.


about 2 weeks ago
Bronze
Al Rivera
about 2 weeks ago
It depends if the tenant wants to stay because the tenant wasn't involved in the sale of the transaction and shouldn't be penalized if the seller or buyer can/can't find a tenant. The seller can also assign the tenant's deposit to the buyer so they can disburse funds to the tenant less any repairs etc. if the tenant chooses to not renew the lease. These are my logical opinions and experiences but discuss it with your broker to obtain a definite answer.


about 2 weeks ago
Silver
Antonio Lechuga
about 2 weeks ago
I don’t think that’s doable. The deposit and prorated rent for the month of closing are required at closing. So are house keys and any remotes for garage if applicable.
The cost of finding tenant are just everyday business expenses. You can’t pass that onto the buyer.
If you had to call in an HVAC technician to do some unexpected repairs the day before closing, you wouldn’t expect to pass the costs onto the buyer. Both examples are just costs of doing business.
I would communicate this to my seller. You want a smooth transaction. I doubt your buyer would agree with what you’re trying to do. This could cast bad mojo onto your transaction and blow your closing out of the water. Let it go. My two cents.


about 2 weeks ago
Bronze
Robert Wilson
about 2 weeks ago
If a referral fee was not negotiated as part of the deal and written in as part of the sales contract, I doubt it.


about 2 weeks ago
Diamond
Joe Applewhite
about 2 weeks ago
Sure. If that is what they agreed. Part of the payment could be a donkey if that is what they signed.


about 2 weeks ago
Platinum
Yvonne Chauvin
about 2 weeks ago
Hi Zhaoqui

Seller cannot deduct his original costs from the pro-rated rent.

Per ADDENDUM REGARDING RESIDENTIAL LEASES, paragraph B(2):
"At closing, Seller shall transfer security deposits (as defined under §92.102, Property Code), if any, to Buyer. At closing, Buyer shall deliver to the tenant a signed statement acknowledging that the Buyer has acquired the Property and is responsible for the return of the security deposit, and specifying the exact dollar amount of the security deposit."

The seller's marketing cost or cost of finding a tenant is not buyer's responsivity to cover.
I hope this helps!



about 2 weeks ago
Gold
Tracie Benton
about 2 weeks ago
Good Question, but it all comes down to what is written in the contract that both parties agreed on.


about 2 weeks ago
Silver
Rashonda Smith
about 2 weeks ago
Everything is negotiable in real estate. If this was. It previously agreed to, it may become an issue amending the contact.


about 2 weeks ago
Silver
CHUKWUELOKA UZODIKE
about 2 weeks ago
From my experience buying and selling investment properties, Sellers sometimes request a refund of leasing commissions paid for a tenant procured after the effective date of the Sales contract, prior to closing. This is however a negotiable item between Buyer and Seller as a Buyer can counter that the agreed price offered for the property factored in the prospect of a tenant being procured by the Seller prior to closing.


about 2 weeks ago
Gold
Penny Clissold
about 5 days ago
No. Your first statement said what she agreed to. She can’t change it and deduct expenses. Ofcouse this all depends on if the paperwork was done correctly. Unless your client signed something saying she could deduct expenses then she can’t do it.


about 5 days ago
Disclaimer: Answers provided are just opinions and should not be accepted as advice.
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