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Buying a tenanted house, rent arrears contract clause
shimlad
Posts: 14 Forumite
The sellers solicitor has inserted the following clause into the contact:
The buyer shall pay to the receivers on completion date all arrears of rent that are payable by any occupier or tenant under any existing tenancy agreement.
Thoughts appreciated
The buyer shall pay to the receivers on completion date all arrears of rent that are payable by any occupier or tenant under any existing tenancy agreement.
Thoughts appreciated
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Comments
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Intriguing. Doesn't make any sense to me - rent arrears are owed to the seller, and that doesn't change on completion. They'd be able to collect both from you and the tenant. Sounds like trying it on, though I'm not experienced in this area.0
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My thoughts are that you're in the process of buying a property where the tenant doesn't pay their rent.0
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Why on earth are you buyibf a property with a non-paying tenant in situ?
Forget the clause.
Forget the property! (unless the seller offers it with vacant possession).0 -
That's outrageous to try to make you personally liable for something that is completely outside of your control and not even the slightest bit your responsibility.0
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ThePants999 wrote: »Intriguing. Doesn't make any sense to me - rent arrears are owed to the seller, and that doesn't change on completion. They'd be able to collect both from you and the tenant. Sounds like trying it on, though I'm not experienced in this area.
Surely if the buyer steps into the shoes as the LL under the existing tenancy agreement, then the tenant should pay any rent arrears to the current LL (ie. buyer) so in theory it does make sense the buyer pays the seller for any arrears (deposits are frequently handled similarly I believe).
That's completely aside from the fact that buying a BTL is buying a business not just a property. You don't want one with a non paying customer. ONLY BUY IF THE PROPERTY IS SOLD VACANT!0 -
No. By default, any rent that covers the period where the seller owned the property is due to the seller. It would have gone to the seller if it was paid on time - being paid late doesn't change whose money it is. The tenant should, of course, start paying any NEW rent to the buyer - and ideally there ought to be some consideration for rent payments made in advance that partly cover the period after completion.Surely if the buyer steps into the shoes as the LL under the existing tenancy agreement, then the tenant should pay any rent arrears to the current LL (ie. buyer) so in theory it does make sense the buyer pays the seller for any arrears (deposits are frequently handled similarly I believe).0 -
ThePants999 wrote: »No. By default, any rent that covers the period where the seller owned the property is due to the seller. It would have gone to the seller if it was paid on time - being paid late doesn't change whose money it is. The tenant should, of course, start paying any NEW rent to the buyer - and ideally there ought to be some consideration for rent payments made in advance that partly cover the period after completion.
I'm not convinced that's the case.0
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