Session 11: Landlord/Tenant & Property Management

Question 1

Assignment of rents clause

Answer 1

Mortgage clause that states if a mortgagor (borrower) gets foreclosed on, the mortgagee (lender) can collect the rents directly from the tenants

Question 2

Non-disturbance clause

Answer 2

Mortgage clause that states that if the mortgagor (borrower) gets foreclosed on, the mortgagee (lendee) won’t terminate the tenancies of the lessee’s who are paying their rent on time

Question 3

Lease option

Answer 3

A provision in a lease that allows the tenant the right to renew their lease if proper notice is given before the expiration of the lease

Question 4

Lease with option to buy

Answer 4

Allows the tenant to purchase the property at or during the lease period. There is no obligation for the tenant to buy the property at the end of the lease

Question 5

Lease purchase agreement

Answer 5

two contracts signed at one time, lease and the purchase contract. Lessee is obligated to purchase the property from the lessor at the end of the lease. If either party refuses to fulfill the purchase agreement, they will be in breach of contract

Question 6

Quiet enjoyment

Answer 6

the right of the tenant to have uninterrupted possession of the property without the interference of the landlord

Question 7

Sale and leaseback

Answer 7

The owner sells the property and then leases it back (model homes, Walmart)

Question 8

Estoppel

Answer 8

Tenants agree to the terms of the lease before the building is sold to the new owner

Question 9

Excess rent

Answer 9

When rent of an existing lease exceeds the rental rate on comparable existing space

Question 10

If the lease expires on excess rent what will the new rate be?

Answer 10

Market rate

Question 11

Economic rent

Answer 11

market rent that real estate can demand in an open market

Question 12

Contract rent

Answer 12

The actual rent paid under existing lease contracts executed between owners and tenants

Question 13

Market rent

Answer 13

potential rental income a property could receive on the open market as of the effective date of an appraisal

Question 14

Anchor Tenant

Answer 14

Major department or chain store strategically located at a shopping center to give maximum exposure to smaller satellite stores

Question 15

Reversionary right

Answer 15

In a lease situation, the landlord has the right to take back possession of the property

Question 16

Does a lease cancel at death?

Answer 16

No, it falls under personal property law

Question 17

What lease will cancel at death?

Answer 17

Estate at will

Question 18

What are the requirements for a valid lease?

Answer 18

Capacity to contract, legal objective, description of the premises, use of the premises, term of the lease, consideration

Question 19

Who does the security deposit belong to?

Answer 19

tenant

Question 20

How much can the landlord charge for a security deposit

Answer 20

No more than 1.5 times the rent

Question 21

Are deposits refundable?

Answer 21

Yes

Question 22

Are fees refundable?

Answer 22

No, and must be stated as so in the lease

Question 23

Statue of Fraud

Answer 23

All contracts need to be in writing to be enforceable

Question 24

Are there exceptions to the statute of fraud?

Answer 24

Yes, if the lease is less than 1 year and broker to broker agreements