Help with Rental Security Deposits Laws for Refunds amp Deductions
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Motley Fool Stock Advisor recommendations have an average return of 397%. For $79 (or just $1.52 per week), join more than 1 million members and don't miss their upcoming stock picks. 30 day money-back guarantee. Sign Up Now Limiting the amount of a security deposit.Requiring landlords to keep security deposits in an interest-bearing bank account that is separate from the landlord’s other personal or business accounts.Establishing a time frame for the return of security deposits after a tenant moves out. Landlord-tenant laws are often non-negotiable. While you and your landlord may have some leeway in negotiating the terms of your lease, there may be certain aspects of landlord-tenant laws in your area that cannot be abridged or waived, even by mutual consent. While this provision is often intended to protect your rights, in some cases, it may cause you hardship. For example, if you live in a state that only allows a landlord to collect the equivalent of one month’s rent as a security deposit, and you have bad credit, you won’t have the option of persuading a landlord to rent to you by offering a larger deposit. You can find information on the rental laws in your state by visiting the United States Department of Housing and Urban Development’s (HUD) website. On the State Information page, click on your state’s name to go to a page about HUD activities in your state. Next, look for the “Get Rental Help” link in the top left column. Click on that link and you’ll find a list of links for rental housing in your state. There should be one or more links to information on landlord-tenant issues that are specific to your state. Your state’s attorney general or legal aid office may also have materials that can help you understand your rights. One more thing: Some cities and counties have their own landlord-tenant ordinances, which may give you additional rights over those provided in your state’s landlord-tenant act. Contact your city hall for more information.
Move-In Inspections. When you move into a new place, ask the landlord or manager to accompany you on an inspection. If you can’t persuade your landlord/building manager to do this, ask a friend to look over the place with you. Take photographs of any damage and get hard copy prints. Both you and the other party should sign and date them. Also, write up a list of any damages in the apartment and ask your landlord to sign and date the inventory list or send the inventory to your landlord via certified mail, return receipt requested.This will help you to challenge any deductions made by your landlord at the end of the lease, by showing that the damage already existed when you moved into your home. Landlords are not supposed to deduct the cost of addressing “normal wear and tear” from your deposit under any circumstances. Check your state’s laws to determine how it distinguishes normal wear and tear and routine maintenance from deductible damage.Apartment Maintenance. As your parents will tell you, it is a lot easier to keep your home in good shape than it is to clean and make repairs after months or years of neglect. Take 15 minutes a day to sweep your floors and dust your furniture. Once a week, take an hour to give your home a more thorough cleaning. At the first sign of a malfunctioning appliance, a stubborn drain, or water damage to your ceiling, contact your property manager, the building engineer, or your landlord. Once you’ve contacted the necessary people, keep a record of who you attempted to contact so that if your landlord or property manager is non-responsive, you can show that you made a good-faith effort to keep your home in good shape.Also, try to avoid any permanent damage to the apartment such as ripped carpet, stained walls, broken appliances, chipped tiles, or scratched countertops. This type of permanent damage will likely result in hefty deductions from your security deposit.In addition to helping you get your security deposit back in full, taking care of your home will leave a favorable impression on your landlord, which is very important if you ever need a reference.Professional Cleaning. One way to boost your chances of getting your whole security deposit back is to hire a professional cleaning service to do a “move-out” cleaning. This may cost you some money, but a squeaky-clean apartment is likely to impress your landlord, who will probably be grateful that you took such good care of the place, and may be more inclined to return your entire deposit.Pre-moveout Inspection. In some areas, such as California, you may have the right to request a pre-moveout inspection. Your landlord or property manager must walk through your rental home with you a couple of weeks before your move-out date. During this inspection, the property manager or landlord should point out issues that could result in a deduction from your security deposit so you have a chance to fix them or to explain the damages.Always Pay Your Rent on Time. Make sure to always pay your rent in full by the due date, so your security deposit isn’t used to cover any unpaid rent or late fees.Give Your Landlord Written Notice Before You Move. In addition to inspections and maintenance, it’s critical that you give your landlord a 30-day written notice that includes the date when you will be vacating your home. In the written notice, make sure to clearly state when you will be returning the keys to the apartment to the landlord. You may be able to use the security deposit to pay for your last month’s rent. Check your lease carefully to see if this is allowed, or discuss it with your landlord. If you plan to use your security deposit to pay for your last month’s rent, plainly state this in your written notice to your landlord.
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By Lainie Petersen Date September 14, 2021FEATURED PROMOTION
Ah, the joys of moving to a new rental apartment or house! Not only do you have to get packed up and move, but you also have to save up the cash to make a deposit on a new place and wait for your current landlord to return the deposit you paid when you first moved in. Security deposits can make moving less affordable and may be difficult to get back. But if you understand your rights as a tenant, take good care of your home, and follow up with your landlord after you move, you can keep your security deposit safe. To help you out, I want to delve into 7 important areas of security deposits that you need to understand.Paying and Getting Back Your Security Deposit
1 Know Your Rights
Before you go apartment-hunting, check out your state’s Landlord and Tenant Act, the body of law that regulates your relationship with a landlord. Some states have strict laws about security deposits. Restrictions imposed by these laws often include:Motley Fool Stock Advisor recommendations have an average return of 397%. For $79 (or just $1.52 per week), join more than 1 million members and don't miss their upcoming stock picks. 30 day money-back guarantee. Sign Up Now Limiting the amount of a security deposit.Requiring landlords to keep security deposits in an interest-bearing bank account that is separate from the landlord’s other personal or business accounts.Establishing a time frame for the return of security deposits after a tenant moves out. Landlord-tenant laws are often non-negotiable. While you and your landlord may have some leeway in negotiating the terms of your lease, there may be certain aspects of landlord-tenant laws in your area that cannot be abridged or waived, even by mutual consent. While this provision is often intended to protect your rights, in some cases, it may cause you hardship. For example, if you live in a state that only allows a landlord to collect the equivalent of one month’s rent as a security deposit, and you have bad credit, you won’t have the option of persuading a landlord to rent to you by offering a larger deposit. You can find information on the rental laws in your state by visiting the United States Department of Housing and Urban Development’s (HUD) website. On the State Information page, click on your state’s name to go to a page about HUD activities in your state. Next, look for the “Get Rental Help” link in the top left column. Click on that link and you’ll find a list of links for rental housing in your state. There should be one or more links to information on landlord-tenant issues that are specific to your state. Your state’s attorney general or legal aid office may also have materials that can help you understand your rights. One more thing: Some cities and counties have their own landlord-tenant ordinances, which may give you additional rights over those provided in your state’s landlord-tenant act. Contact your city hall for more information.
2 Rent Prepayments
While most landlords require new tenants to pay both their first month’s rent and the security deposit at the time of signing a lease, some landlords may also ask you to pay your last month’s rent as well. This is a prepayment of rent for the final month of the lease. Landlords sometimes ask for this prepayment because some tenants will skip out without paying rent in the last month, and their security deposit won’t cover the rent owed and the cost of repairing damages. Some states, such as Massachusetts, require landlords to treat a prepayment of your last month’s rent as they would a security deposit, paying you interest on the prepayment when you move out. Check the laws in your area to learn more about the treatment of this payment. If you are required by your landlord to pay both first and last month’s rent (and the law in your state allows it), along with a security deposit, your total payment at lease signing is going to be a hefty three months’ rent. If this is going to be a hardship for you, try to negotiate with your landlord. Some may have this policy because they’ve been burned in the past by unreliable tenants. If you can show that you have good credit and excellent references from previous landlords, you may be able get your new landlord to waive this requirement.3 Move-In Fees in Lieu of Security Deposits
In some housing markets, landlords and property management companies no longer require security deposits. Instead, renters are asked to pay a non-refundable “move-in fee,” which is typically around $200-$300. Landlords and property managers sometimes prefer move-in fees because they won’t have to comply with laws that require them to keep your deposit in an escrow account and they won’t have to pay you interest. It is not legal to charge a non-refundable move-in fee in some jurisdictions. A couple of caveats about move-in fees: When you see ads for rental properties that advertise “no security deposit!” be sure to ask the landlord or property manager if they still want a move-in fee.While a move-in fee can lower your initial rental costs, you won’t get that money back, nor any interest (where applicable), after you move out.As noted above, if your landlord or property manager has done away with security deposits and requires move-in fees instead, and you have bad credit, you may not be able to negotiate a lease by offering an additional security deposit.4 Special Deposits & Fees
Some states allow landlords to charge additional deposits and fees related to the application and move-in costs, or for tenants who pose a greater risk than others for causing damage to their property. For example, tenants with pets may be charged a pet fee or a pet deposit to cover potential animal-related damages to the home. This deposit or fee may not be refundable, so be sure to ask about it before agreeing to pay. As another example, some landlords will also ask for an additional deposit if you have an aquarium or a water bed, out of concern that they could leak and cause water damage to the apartment building’s floors and ceilings. In addition, an application fee, cleaning fee, and a fee for ordering a credit check or a background check as part of tenant screening may be required and are typically non-refundable. Request an itemized receipt from your landlord for all fees paid for your records.5 Protecting Your Deposit
Take any measures necessary to protect your security deposit, including taking care of your rental home as if it belonged to you and making it clear to the landlord what damages existed before you moved in. Here a few tips to help you make sure that you get your security deposit back in full:Move-In Inspections. When you move into a new place, ask the landlord or manager to accompany you on an inspection. If you can’t persuade your landlord/building manager to do this, ask a friend to look over the place with you. Take photographs of any damage and get hard copy prints. Both you and the other party should sign and date them. Also, write up a list of any damages in the apartment and ask your landlord to sign and date the inventory list or send the inventory to your landlord via certified mail, return receipt requested.This will help you to challenge any deductions made by your landlord at the end of the lease, by showing that the damage already existed when you moved into your home. Landlords are not supposed to deduct the cost of addressing “normal wear and tear” from your deposit under any circumstances. Check your state’s laws to determine how it distinguishes normal wear and tear and routine maintenance from deductible damage.Apartment Maintenance. As your parents will tell you, it is a lot easier to keep your home in good shape than it is to clean and make repairs after months or years of neglect. Take 15 minutes a day to sweep your floors and dust your furniture. Once a week, take an hour to give your home a more thorough cleaning. At the first sign of a malfunctioning appliance, a stubborn drain, or water damage to your ceiling, contact your property manager, the building engineer, or your landlord. Once you’ve contacted the necessary people, keep a record of who you attempted to contact so that if your landlord or property manager is non-responsive, you can show that you made a good-faith effort to keep your home in good shape.Also, try to avoid any permanent damage to the apartment such as ripped carpet, stained walls, broken appliances, chipped tiles, or scratched countertops. This type of permanent damage will likely result in hefty deductions from your security deposit.In addition to helping you get your security deposit back in full, taking care of your home will leave a favorable impression on your landlord, which is very important if you ever need a reference.Professional Cleaning. One way to boost your chances of getting your whole security deposit back is to hire a professional cleaning service to do a “move-out” cleaning. This may cost you some money, but a squeaky-clean apartment is likely to impress your landlord, who will probably be grateful that you took such good care of the place, and may be more inclined to return your entire deposit.Pre-moveout Inspection. In some areas, such as California, you may have the right to request a pre-moveout inspection. Your landlord or property manager must walk through your rental home with you a couple of weeks before your move-out date. During this inspection, the property manager or landlord should point out issues that could result in a deduction from your security deposit so you have a chance to fix them or to explain the damages.Always Pay Your Rent on Time. Make sure to always pay your rent in full by the due date, so your security deposit isn’t used to cover any unpaid rent or late fees.Give Your Landlord Written Notice Before You Move. In addition to inspections and maintenance, it’s critical that you give your landlord a 30-day written notice that includes the date when you will be vacating your home. In the written notice, make sure to clearly state when you will be returning the keys to the apartment to the landlord. You may be able to use the security deposit to pay for your last month’s rent. Check your lease carefully to see if this is allowed, or discuss it with your landlord. If you plan to use your security deposit to pay for your last month’s rent, plainly state this in your written notice to your landlord.