Contracts

What is 'estoppel certificate' in commercial real estate and when is it used in Hawaii?

AA. A certificate preventing a tenant from vacating before the lease expires
BB. A statement from a tenant certifying key lease terms (rent, term, options, defaults) to a prospective buyer or lender; used in commercial real estate due diligence✓ Correct
CC. A certificate from the county confirming a property's zoning status
DD. A lender's certificate stopping the foreclosure process temporarily

Explanation

An estoppel certificate is a tenant's written confirmation of current lease terms—rent amount, remaining term, options, current status of landlord/tenant obligations, and whether there are any defaults or disputes. In Hawaii commercial transactions, buyers and lenders require estoppel certificates to verify the tenant leases before closing or funding.

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