On Today’s Fiduciary Friday Joe discusses how rental items and contracted services affect the offer on a home.
What Is A Rental Item?
Many buyers take on rental contracts, including hot water tanks, furnaces, air conditioners, water softeners and alarm systems. When it comes time to sell, sellers must be clear about which contracts must be assumed by the buyer. They should disclose the details of every contract, so the buyer can make an informed decision.
If the listing includes several rental contracts that need to be assumed, buyers should consider making any offer conditional on reviewing and being satisfied with all the terms of the rental contracts, especially if there are any penalties for cancellation.
What Are the The Monthly Payments On The Rental Item?
To avoid any surprises, sellers must disclose what the monthly payments are on their rental services. If a home has a lot of rented items or service contracts, it could affect the budget you are willing to spend on that specific home.
What Is The Term Of the Agreement?
How long is the owner in the contract you are about to assume? An example of this would be, an owner of a home pays a monthly fee for a security system. You purchase the home and accept that there is a security system installed. You need to decide if you are willing to pay out the remaining term of the contract for the service of the security system.
What Is The Buy Out Amount?
it is important to know if you are a buyer and you decide to purchase that rental item such as the hot water tank for example. This could also affect your budget.
If the listing includes several rental contracts that need to be assumed, buyers should consider making any offer conditional on reviewing and being satisfied with all the terms of the rental contracts, especially if there are any penalties for cancellation.
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