WutangCurse Real Estate Implications

One of the elements of the Senate relief bill (still to be passed by the House) is aid to individuals in the form of cash to be able to pay their rent and to avoid a default under an apartment lease.

Apartment tenant

If you rent an apartment, the organizational structure — the people or entities involved —  is this:

Owner/landlord — The owner is the person or legal entity whose name is on the deed filed at the county courthouse. All power and authority is vested in the owner.

Lender — The owner has likely borrowed money to purchase or build the property. The document that formalizes that arrangement is the mortgage. It contains the terms of the agreement between the lender and the owner pertinent to the mortgage. A mortgage has the following elements:

Lender — a bank, insurance company, pension fund, REIT — the source of the money
Borrower — the legal vehicle through which the owner owns the property
Principal amount — the initial amount borrowed
Term of the loan — how many years the loan extends
Amortization schedule — the number of years over which principal is repaid which may differ from the term of the loan
Interest rate — the annual interest to be paid on the outstanding principal
Default provisions — what happens if the monthly loan payment is not met

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