Offset Statement
Definition:
An Offset Statement is a written declaration by a tenant or borrower confirming the current status of their financial obligations, such as rent payments or loan balances, and acknowledging that no claims or offsets exist against the landlord or lender unless specifically stated. It is often requested during property sales, refinancing, or loan assignments to verify accurate financial records and prevent future disputes.
Offset Statement Information
Offset statements are most commonly used in commercial leasing and mortgage transactions. In a lease context, the landlord may request an offset statement (often called an estoppel certificate) from the tenant to confirm that the lease is valid, rent is current, and no unresolved claims exist. Lenders and buyers rely on these statements to ensure that income streams from leases or loans are accurately represented. By signing an offset statement, the party certifies the accuracy of the information, which can later be enforced if discrepancies arise. Accuracy and full disclosure are critical, as these statements are binding once executed.
Florida Legal Definition
In Florida, offset statements are governed by general principles of contract and real estate law under Florida Statutes Chapter 83 (Landlord and Tenant) and Chapter 475 (Real Estate Brokers, Sales Associates, and Schools). When used in mortgage transactions, they may also be referenced in documentation governed by Florida Statutes Chapter 697 (Instruments Deemed Mortgages). Florida courts uphold offset or estoppel statements as binding instruments when voluntarily signed and relied upon by third parties, such as lenders or purchasers. The signer is generally prevented (or “estopped”) from later denying the truth of the certified information.
How It’s Used in Practice
In practice, offset statements are used during property sales, refinancing, or assignments of lease and mortgage interests. A property buyer or lender will request these statements to confirm that tenants or borrowers have no existing disputes or claims that could affect the property’s income or title. In commercial real estate, attorneys prepare and review offset statements to ensure that they accurately reflect all obligations and potential claims. Once signed, they provide assurance to investors and lenders that the property’s financial representations are reliable.
Key Takeaways
- An Offset Statement confirms the status of rent, lease, or loan obligations and any existing claims or offsets.
- Used to verify financial accuracy in property sales, refinancing, or loan transfers.
- In Florida, governed by general contract principles and real estate laws under Chapters 83, 475, and 697 of the Florida Statutes.
- Binding once signed and relied upon by third parties such as lenders or buyers.
- Essential for ensuring transparency and preventing future financial disputes in real estate transactions.
Disclaimer: The information and opinions provided are for general educational, informational or entertainment purposes only and should not be construed as legal advice or a substitute for consultation with a qualified attorney. Any information that you read does not create an attorney–client relationship with Barnes Walker, Goethe, Perron, Shea & Johnson, PLLC, or any of its attorneys. Because laws, regulations, and court interpretations may change over time, the definitions and explanations provided here may not reflect the most current legal standards. The application of law varies depending on your particular facts and jurisdiction. For advice regarding your specific situation, please contact one of our Florida attorneys for personalized guidance.
Trust • Experience • Results
Ready to Get Started?
Get started with Barnes Walker today.
