A rental property in Texas is being sold. The tenant's lease extends 6 months beyond the closing date. Under the TREC contract, how are the tenant's rent payments handled at closing?
Correct Answer
C) Rents are prorated at closing, with the buyer receiving credit for the period after closing
Under Paragraph 13, rents are prorated at closing. The seller receives rent for the period up to closing, and the buyer receives credit for rent already collected for the period after closing.
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Related Concepts
Contract termination occurs when a contract is ended or discharged, releasing both parties from their obligations. A contract can be terminated through performance, mutual agreement, operation of law, or breach.
A counteroffer is a response to an original offer that changes one or more terms of the offer, effectively rejecting the original offer and creating a new offer. The party who makes the counteroffer becomes the new offeror.
Earnest money is a deposit made by the buyer at the time of the offer or shortly after to demonstrate good faith and serious intent to purchase the property. It is also called a good faith deposit.
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