Rents, Security Deposits And Your Purchase Of An Investment Property

Negotiating closing costs on investment propertyAre you negotiating on an investment property with tenants right now?  Don’t forget to negotiate the rents and the security deposits.  Those aren’t givens. 

And secondarily, they can foul up a closing at the last minute if you aren’t careful. They can have an effect on your closing costs if you are working with an inexperienced underwriter or with a loan product that is very strict when it comes to investment property closing costs.   That’s it. 

 

3 Comments

Filed under Real Estate Investing

3 responses to “Rents, Security Deposits And Your Purchase Of An Investment Property

  1. Talk about a snake in the grass — rent prorates and deposit transfers are definitely on the A-List.

    Had a client purchase a small 22u apt. complex many years ago, subject to, with additional seller financing. Price was $750K w/10% down.

    CA contracts deal with rent prorates/deposits in the boiler plate pretty well. I made sure the offer had the closing date on the 5th of the month. Counting his original deposit attached to the offer his entire cash amount required for closing was under $70K — more than $5K less than his down payment!

    He liked me.

  2. Jeff- right on. We have a boiler plate provision as well that is fairly misunderstood by some of the less experienced. So I like to put it in 5th grade English which a few times has still been too advanced. 😉

  3. I thought so. Here, it’s pretty 5th grade already. We ARE CA you know. 🙂

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