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- An estoppel certificate is the tenant's signed confirmation of the facts of one tenancy, which a buyer and its lender use to test your rent roll.
- A residential tenant generally has to sign one only if the lease requires it.
- Send a form filled in from your records. A certificate that asks a tenant to confirm something wrong starts a dispute in the middle of escrow.
- Before the forms go out, agree with the buyer on what counts when a tenant does not sign.
What an estoppel certificate is
An estoppel certificate is a short document in which a tenant states the facts of the tenancy as of the day they sign it. The name comes from the legal idea of estoppel. A person who signs a statement that someone else relies on may be held to it later, so the certificate turns the tenant's version of the tenancy into something a buyer can rely on.
Your rent roll is your own account of the building. A buyer has no way to test it against the people living there except by asking them, and the certificate is how that question gets asked in writing. A lender financing the purchase may ask for certificates as well, because the rents are what repay its loan.
An apartment certificate does not need to be long. The tenant is confirming a handful of facts, and a one-page form in plain language is easier to read, easier to check and easier to return.
What the certificate should confirm
You or your agent prepare the form, so you decide what it asks. For an apartment unit, these are the items a buyer will want and the record you should check each one against before it goes out.
| Item | Why the buyer cares | Check it against |
|---|---|---|
| Names of the tenants on the lease | Who the buyer is renting to | The lease and any addenda |
| Start date, and end date or month-to-month status | How long the current terms run | The lease |
| Monthly rent, and the date rent is paid through | The income the buyer is paying for | Your rent ledger |
| Security deposit held | The credit the buyer receives in escrow and the refund it will owe later | Your deposit records |
| Prepaid rent, concessions or rent credits | Money or discounts the buyer inherits | The ledger and any written agreements |
| Parking, storage, pets and other extras | What the rent includes | The lease and addenda |
| Side agreements, promised repairs, or disputes with you | Obligations that are not in the file | Your correspondence and any complaints |
| Any buyout agreement | Whether the unit may soon be vacant, and whether the tenant can still cancel | Your filings with LAHD under LAMC section 151.31 |
For RSO units there is one more record to reconcile. LAHD requires owners to report each unit's rent and tenancy information every year through its rent registry, and registration is not complete until that information is in. Make sure the registry filing, your ledger and the certificate tell the same story before a buyer compares them.
Does a residential tenant have to sign one?
It depends on the lease. Where a written lease requires the tenant to sign an estoppel certificate, refusing can be a breach of the lease. Where the lease has no such clause, a tenant can generally decline. Read every lease in the building for the clause before you promise a buyer anything, because leases signed years apart in the same building may say different things.
Some lease forms go further. They set a short deadline for returning the certificate and say that a tenant who does not respond is treated as agreeing with what it says. That language may satisfy a buyer, but how far it reaches against a particular tenant who never signed is a legal question.
What to do when a tenant will not sign
Start by asking why. A refusal can come from a form that states something the tenant believes is wrong, or from not knowing what the document is. Both have simple fixes, so work through these in order:
- Correct the form if the tenant is right. A certificate that repeats an error in your records does more harm than a missing one.
- Explain what the document is and offer to go through it with the tenant, in their language if that helps.
- Invite the tenant to write in corrections, or their own statement of the facts, and then sign. A marked-up certificate still tells the buyer what the tenant says.
- If the tenant still will not sign, give the buyer the lease, the rent ledger, the deposit records and bank records of rent received for that unit.
- If the contract allows it, sign a certificate yourself for that unit stating the same facts. Your statement then becomes a representation you answer for, so check every line.
None of these fallbacks works unless the purchase contract says it does. When you negotiate the contract, decide what happens if certificates are missing. You can agree that a seller certificate stands in for a tenant's, that certificates from a set share of the units are enough, or that a missing certificate does not let the buyer cancel. Settling that before the forms go out keeps one tenant from holding up the whole closing.
Timing, and getting the facts right
A certificate speaks as of the day it is signed. Send the forms during escrow, once the buyer's timeline is set, so the rent and paid-through dates are still current when the buyer and lender read them. If a lease sets a deadline for returning the certificate, give the tenant at least that long.
Fill in the facts yourself from your records and ask the tenant to confirm or correct them. A blank form invites guesses, and a guess that differs from your rent roll becomes a question the buyer asks you to answer.
The deposit line needs the most care. Under AB 12, a deposit demanded or collected on or after July 1, 2024 is capped at one month's rent, apart from a narrow exception for small owners. The cap does not reach deposits collected before that date, so a long tenancy may properly show a larger deposit than a new one. The certificate should show the amount you actually hold, because that is the amount the buyer will be credited and will later have to account for.
Keep a copy of every certificate you send and every one that comes back. If the buyer or its lender later asks why a unit's rent or deposit differs from what a tenant signed, those copies are your answer.