Closing on your first investment property but not sure what to review during due diligence period and before closing? Stay calm, we have interviewed a property manager to get an expert’s tips on how to facilitate a smooth closing.
Ask For A Tenant Estoppel
Asking for tenant estoppel is a great way to cover your tracks, and avoid future dilemmas over a tenant’s lease. One thing an estoppel does is provide proof of cash flow. More importantly, estoppel prohibits a tenant from going back on their lease and making an argument that their lease should be changed. Also, this will bring to light any issues or promises that the seller has with the tenant and make sure that you as the buyer are made aware before closing.
Have Your Future Property Manager Go to the Property Before Closing
Having a reliable property manager is a necessary investment, and figuring out who it is going to be is a very wise thing to do before closing. A solid property manager will know exactly what to look for in a property. They will find costs that will be incurred in the future, that you may not have realized on your own. Generally, an experienced property manager will have a great perspective on what can and can’t be done to a building, and what problems will occur in the future.