[WSBAPT] Closing of home & leasehold

[pugetsoundlaw at gmail.com]

Depends on the terms of the lease.  Some leases provide for early termination upon sale, usually with some sort of notice to the tenant – doesn’t sound like that is the case here.

 

A common provision in most of the lease forms that I have seen is that a sale does not affect the lease, that upon sale the prior owner/seller is released, and the tenant is to look solely to the new owner/buyer for performance of the landlord/owner’s duties after closing.  It is common for residential real estate to be sold from investor to investor without any prior notice to the tenants.  The new landlord takes over for the old landlord, takes subject to the leases, notifies the tenants after closing, and the status quo continues for the tenant.  The leases, tenant info, rent rolls, transfer of deposits, etc should be reflected in the P&S documents.

 

However, a lease that provides that the seller is released (as to the tenant) and lease obligations are assumed by the new owner certainly doesn’t relieve the seller of his duties to the buyer as agreed to under the PSA.  If the PSA did not contemplate the existing tenancy, such as when the buyer plans to occupy the premises personally, then the seller has a problem as to the buyer.

 

It’s surprising that the realtors weren’t aware of the tenant’s existence, didn’t anyone notice a tenant during the showing or inspection?  Not that it matters for practical purposes anymore at this stage.

 

Often a saavy landlord/seller can arrange an accommodation with a tenant to terminate a lease early, such as helping to pay moving expenses or first & last month’s rent at a new rental.  However, usually that is going to need to be done at least 30 days or more in advance, especially in this extremely tight rental market.

 

Tara M. Roberts

Puget Sound Law pllc

roberts at pugetsoundlaw.com <mailto:roberts at pugetsoundlaw.com> 

 


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From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Jennifer Sohn
Sent: Friday, May 27, 2016 10:14 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] Closing of home & leasehold

 

Thanks, that is my understanding as well. Seller is adamant that the lease is always subject to the PSA so I wanted to double check.

 

Thanks,

 

Jennifer


On May 27, 2016, at 9:54 AM, Laird, Katherine <KatherineLaird at CenturyPacificLP.com <mailto:KatherineLaird at centurypacificlp.com> > wrote:

Unless the tenancy is month to month (sounds like it is not), the tenant has the contractual right to remain in the property until the end of the lease (assuming no lease default).  The seller will be default under the PSA if they are unable to deliver possession.  

 

Katherine Kramer Laird 
CenturyPacific,LLLP
Suite 1680 
1201 Third Avenue 
Seattle, WA  98101 
Ph. 206-757-8892/Mobile. 206-915-0109 
Fax 206-757-7890 
katherinelaird at centurypacificlp.com <mailto:katherinelaird at centurypacificlp.com>  

    

 

From: wsbapt-bounces at lists.wsbarppt.com <mailto:wsbapt-bounces at lists.wsbarppt.com>  [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Jennifer Sohn
Sent: Friday, May 27, 2016 9:46 AM
To: WSBA Probate & Trust Listserv
Subject: [WSBAPT] Closing of home & leasehold

 

Hi, I have someone who signed a purchase and sale agreement (the standard MLS form) to purchase a home and to get possession on closing. We are less than a week away from closing and we learned that the lease for the tenant at the home does not expire for another month. "Possession on closing" means the seller needs to make sure the tenant is out of there by closing - right?




 

-- 

Best regards,

 

Jennifer Y. Sohn

Attorney at Law

(Licensed in CA and WA)

Sohn Law PLLC

10900 NE 4th Street, Suite 1850

Bellevue, WA 98004

Tel: 425.522.3861

Fax: 425.732.9748 

Email:  <mailto:jennifer at sohn-law.com> jennifer at sohn-law.com

 <http://www.sohn-law.com/> http://www.sohn-law.com

 

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