At some point during a commercial tenancy, most tenants will be asked to sign an estoppel certificate — often with a short deadline and little explanation of why it matters. Understanding what an estoppel certificate actually does, and reviewing it carefully before signing, protects a tenant from inadvertently giving up rights they didn’t intend to.
What an Estoppel Certificate Does
An estoppel certificate is a signed statement from the tenant confirming the current status and terms of their lease — typically requested by a landlord in connection with selling the property, refinancing, or obtaining a new loan, similar to the due diligence process a buyer undertakes when acquiring commercial property with existing tenants in place. Lenders and buyers rely on estoppel certificates to confirm the lease terms match what the landlord has represented, directly from the tenant.
What Estoppel Certificates Typically Confirm
- The lease commencement date, term, and expiration date
- Current rent amount and whether it’s paid current
- Confirmation of any security deposit held, and its amount
- Whether the landlord is currently in default under the lease, to the tenant’s knowledge
- Confirmation of any options (renewal, expansion, right of first refusal) the tenant holds
- Confirmation that the lease has not been modified beyond what’s been disclosed
Why “Estoppel” — And Why It Matters Legally
The legal significance of an estoppel certificate lies in its name: once signed, a tenant is generally “estopped” (legally prevented) from later asserting facts contrary to what they certified. If a tenant certifies that no defaults exist and the rent is current, and later tries to claim otherwise in a dispute, the estoppel certificate can be used against them — even if the certification was made carelessly or without careful review.
Common Mistakes Tenants Make When Signing
- Signing quickly under a tight deadline without actually reviewing lease files to confirm accuracy
- Certifying rent is current without checking actual payment records
- Failing to note existing disputes or landlord defaults, even minor ones, out of a desire to avoid conflict
- Overlooking whether the estoppel form includes broader waivers or representations beyond a simple confirmation of lease terms — some landlord-drafted estoppel forms attempt to include additional waivers not warranted by a standard confirmation request
What to Do Before Signing
- Pull the actual lease file and compare it line-by-line against what the certificate states
- Confirm rent payment history directly, rather than relying on memory
- Note any known issues, disputes, or landlord defaults explicitly, rather than certifying a clean status to avoid friction
- Request reasonable time to review — while landlords often present these with urgency, tenants generally have more time than the deadline suggests, and rushing creates unnecessary risk
Lease Provisions Requiring Estoppel Cooperation
Many leases include a provision obligating the tenant to provide an estoppel certificate within a specified number of days upon request — meaning tenants generally can’t simply refuse. Understanding this obligation exists (and its timeline) before being asked helps avoid being caught off guard by a tight turnaround.
Received an estoppel certificate request and want to make sure what you’re signing is accurate? Brent A. Levison, P.A. helps commercial tenants review estoppel certificates before they become a legal liability. Contact the firm today for a consultation.
The information in this article is provided for general informational purposes only and does not constitute legal advice. For advice specific to your situation, please consult a qualified attorney.