One of the most contentious aspects for both property managers and tenants is the handling of a security deposit. Designed as a way to protect property managers and owners against possible damages, security deposits are not designed to be used as last month’s rent, and the majority of rental leases state that up front. What continually causes problems are the way that security deposits are handled upon a tenant’s move-out. While laws vary from state to state, the majority state that a property manager must provide their former tenant with either their security deposit returned in full, or an accompanying statement if a portion or all is used to compensate the management company for damages incurred.
The problem occurs when management companies simply decide to keep a portion (or all) of a deposit without any explanation. This happens more frequently than you would expect, and many individuals that did damage the unit in some way have been awarded their full deposit back after taking management companies to court over that lack of statement. While to some managers, the damages may seem obvious, a statement explaining what the security deposit was used for is required. A statement saying ‘repaired damages’ is not sufficient. All of this can be avoided by taking a few extra precautions that are designed to protect your property and your tenant’s rights.
Read more...Ways to Improve the Security Deposit Process | PropertyManager.com
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