*Non-refundable* Security Deposit
In my real estate club meeting, the director was saying that he nevers gives the security deposit back to the tenant because he uses it to clean/paint/fix up the house when the tenant moves out since his properties are always in mint condition after a rehab.
I just wanted to see if you all did the same thing. I always thought that a deposit was something that the tenant gets back (minus any excessive fixes).
This is a great question. I have been hearing people that are much bigger then me saying the same thing. i always wondered if they were able to sleep at night and look themselves in the mirror.
I have however been very stringent, within my rights about refunding money. I just had a tenant move out and did not surrender the property until the 6th of the next month. So I charged him for the entire month and a late fee since he did not pay me.
Robert
matty...as long as you spell it out in the contract it is not illegal ...i generally charge $600. deposit + 1st & last ...with $300. refundable. I give my properties to tenants in PRISTINE condition & expect it back that way...hence the $300. to make sure it does not come out of my pocket...that is, after all only a minimal charge for restoration...has anyone ever had just a $300. charge for cleaning carpet, paint, filling holes, cleaning stoves, disposing of trash, redoing the ignored landscape (even if it was in the contract) etc. etc. etc....no, there is no greed involved...just good common sense...regards, CWal
I would never make the entire deposit non-refundable, because then the tenants have NO incentive to clean up on their way out.
As a former tenant, I would resent a substantial non-refundable deposit. Whether it would would make me turn down a place or not would depend on what else is out there in the market. The tenant should definitely be aware (explicitly) before their application fee has been spent.
I agree, with holding the whole security deposit is unlawful and immoral. Unless they have not paid rent, fees, utilities, or ANYTHING other than wear or tear. Take inventory and document everything with digital imaging, always have proof and include what you expect from a tenant in the lease agreement.
[addsig]
Just one example i know of.
One landlord I do business with, writes in the lease that each cigarette burn hole will cost $ 50.00 out of the deposit.
there are other items mentioned as well
John