Prorations Discussion Homework
Name three common items that are often prorated at a Closing and explain how to calculate the proration for each one if the Closing Date for the transaction falls on December 15. You may use examples for your explanation if you state all necessary facts beyond the Closing Date, which is provided.
Chapter 7 Leases – See Class Lease
1. Find three places in the Lease where prorations would be used to calculate the amount due from the tenant and explain how those calculations would be performed.
2. What types of insurance is the tenant required to carry and in what amounts?
3. Review the lease provisions relating to Estoppel Certificates. Research why and when an owner may need a tenant to provide an Estoppel Certificate. Provide two examples of situations requiring Estoppel Certificates and explain why they are important in those situations.