Closing a House with Tenants in place New York

[Reuben Dacher-Shapiro]

BP community,

What steps do you take to verify tenants are current on rent? In light of COVID and the extension of the NY moratorium on rent I am concerned with closing on a property with tenants in place. And as a general matter, as NY has onerous eviction procedures.

I recently had a multi family under contract I was planning to house hack. Rental receipts and rent being current were a condition I requested precedent to closing, but seller was not happy to say the least. Part of their explanation was she did business “differently” and trusted her tenants. I cancelled the contract as one of the tenants was already late on rent and I found the sellers explanation for not providing rent verification wanting. They had the Venmo transactions but because they used Venmo frequently they could not show me each one.

Understanding there is no way to guarantee a tenant continue to pays rent, what strategies have people used to close houses with active leases? Beyond making vacancy a condition precedent to closing, which could cause other problems for seller as they don’t have a straightforward way to remove tenants right now.

Appreciate any insight the community may have. Relatedly, I am still looking to purchase a multifamily to house hack in the capital district. Feel free to reach out if you would like to connect.