What is the purpose of a Tenancy Statement/Estoppel Certificate?

What is the purpose of a Tenancy Statement/Estoppel Certificate?

• A. To state rental payment history
• B. To prevent parties from claiming different facts
• C. To verify tenant ownership
• D. To provide a lease termination notice

Answer: (B)

The purpose of a Tenancy Statement or Estoppel Certificate primarily revolves around providing a legally binding clarification of facts relating to a rental agreement. This document is typically signed by the tenant and used in real estate transactions, especially during the sale or refinancing of a property. By confirming that both parties are aware of and agree to the current terms of the lease—such as the rent amount, the duration of the lease, and the status of any security deposit—the certificate prevents tenants and landlords from later asserting different facts that could undermine the integrity of the transaction. This mutual acknowledgment helps streamline negotiations and ensures that all parties are on the same page regarding key lease terms. While establishing rental payment history, verifying tenant ownership, or providing termination notices might be relevant in real estate practices, these aspects do not encapsulate the primary purpose of the Tenancy Statement/Estoppel Certificate. This document is centered on confirming the agreement between parties to minimize disputes and uncertainties in the future.

The purpose of a Tenancy Statement or Estoppel Certificate primarily revolves around providing a legally binding clarification of facts relating to a rental agreement. This document is typically signed by the tenant and used in real estate transactions, especially during the sale or refinancing of a property.

By confirming that both parties are aware of and agree to the current terms of the lease—such as the rent amount, the duration of the lease, and the status of any security deposit—the certificate prevents tenants and landlords from later asserting different facts that could undermine the integrity of the transaction. This mutual acknowledgment helps streamline negotiations and ensures that all parties are on the same page regarding key lease terms.

While establishing rental payment history, verifying tenant ownership, or providing termination notices might be relevant in real estate practices, these aspects do not encapsulate the primary purpose of the Tenancy Statement/Estoppel Certificate. This document is centered on confirming the agreement between parties to minimize disputes and uncertainties in the future.