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PSA: Tip re: security deposits

Hi all,

I was speaking with a colleague of mine this morning who has been a Realtor/Property Manager/Landlord for over 40 years. He brought up a good, common sense tip that I thought I'd share.

Always charge a different amount for the security deposit and rent. Reason being that it helps differentiate what the money is for. This can be very helpful in relations between a landlord/manager and a tenant and can also prove helpful if you are ever in a court case re: the tenancy.

For instance, if you charge $1000 in rent and $1000 in security deposit, a tenant could claim they thought it was for the last months rent when it comes time to vacate. (FYI: In some states, it is illegal to use the security deposit as last months rent).

But if you charge $1000 in rent and $1200 in security deposit, it is less likely that the tenant (or judge) will become confused over what each payment was for.

I know it seems like a little thing, but I thought it was a good common sense habit that could spare a lot of potential confusion.

Just the ramblings of mind...thanks for listening :)

 

Life is a roller coaster, enjoy it!

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Lighthouse State Beach, Santa Cruz.

Re: PSA: Tip re: security deposits

  • While your friend's advice may be fine in your area, in some states you are not allowed to ask for an amount of security in excess of 1 months rent.  So if anyone is thinking of doing this be sure to check your state for the laws regarding security deposits.

    We have numerous rental properties and always ask for just under the amount of first months rent. Example: rent is a $1000 and we will ask for $850 or $900 for security.

  • Thank you MN, a good point indeed :)

     

    Life is a roller coaster, enjoy it!

    Image and video hosting by TinyPic

    Lighthouse State Beach, Santa Cruz.

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