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How to protect your right to the security deposit


Whether someone is renting storage Brooklyn or renting residential housing to live in, things can go awry. So there’s always a risk that something could happen to the property they are renting. And when you are the landlord and own the property in question, you want to protect it any way you can. A security deposit is one way to do that. While it won’t prevent damage to the property or make the tenants pay utilities and rent, it can help fix these issues after they happen. This is why everyone who rents their property to others should know how to protect their right to the security deposit!

Security deposit laws

By choice or by design, more than half the people living in New York City rent their homes. So if you have a property you are not using and are thinking of renting it out, the Big Apple is the place to be. But before you start renting the property you’re not using you should look into local laws concerning rent and security deposit. The gist of them is that you are allowed to collect money from a tenant to repair the damage that exceeds normal wear and tear and for unpaid rent. After the tenant moves out, you are expected to return the unused portion of the security deposition (often within a set timeframe and sometimes with interest). However, these laws vary by state. So do your research!

Two notes, one saying illegal, one legal.
Make sure to follow the local laws about renting and deposit.

When can a landlord keep the security deposit?

There are five common reasons why a landlord may be within their rights to keep a security deposit:

  1. if the tenant breaks their lease or terminates it early
  2. if the tenant fails to pay rent
  3. when the property is damaged beyond regular wear and tear
  4. in case of excessive cleaning costs caused by something other than regular wear and tear
  5. if the tenant has not paid utilities

Laws about this will, again, vary by state so read up on local regulations!

How to protect your right to the security deposit?

While temporary housing certainly has its advantages, most people don’t really think of it as their home. If you’re worried about what might happen to the property you are renting out because of that, it’s worth it to learn how to protect your right to the security deposit.

Put it in writing

You should always include all the information about the security deposit in the lease agreement. This makes it a part of the contract you have with your tenant and ensures they are aware of and informed about the deposit in advance.

Here’s what you should always put in writing:

  • the amount of the security deposit
  • where the deposit is stored and how (in which account at which bank and under which conditions as defined by local laws)
  • the fact that the security deposit is (conditionally) refundable
  • the conditions under which you may keep the deposit (once again as defined by local laws)
People signing a document.
Put all the information about the security deposit in writing.

Photographically document the property before the tenant moves in

In order to protect your right to the security deposit, you should have proof of the condition of the property prior to renting. The photographs should be detailed and cover all places where damage can easily occur. Cover the walls, corners, outlets, windows, furniture and anything of special monetary or sentimental value. Date the photos and take new ones before every new tenant.

It may be a good idea to print the photos out and have your tenant date and sign them as well. This means they confirm the property is in the state the photos show. If it’s easier, you can also write out a statement saying the photos are true to life and ask your tenant to sign that instead.

Make a move-in checklist (and inform your tenant of it)

As you take your tenant around the property, test everything to prove that it’s in working order. Open and shut (and lock if applicable) all windows and doors. Turn on the stove, fridge, radio, TV, and other relevant appliances. Don’t forget to run all faucets and flush the toilet. Finally, ask your tenant to sign a statement saying all these things are working at the time of their moving in. This is your move-in checklist. It should state that:

  • stove, fridge, freezer, and TV (and other appliances if necessary) are in working order
  • all outlets are working and their covers are in place
  • all windows and doors close and lock
  • smoke and carbon monoxide detectors are present and in working order (especially if this is required by law)

You may also include any other things that can be easily broken and are difficult or expensive to fix and replace. If anything is not working at the time your tenant moves out, this signed checklist is your proof that you’re not at fault. This, along with photographic evidence, is what you can use to protect your right to the security deposit.

Make a move-out checklist (and inform your tenant of it)

If you notice your tenant looking into international moving companies NYC, it might be time to go through a move-out checklist with them. Inform them (preferably in writing) of what they need to do before they vacate the property. You may, for example, ask them to clean the place and take out the trash. You should also specify where and by which time they must hand in their key.

Photographically document the property after the tenant moves out

Once your tenant has found their new place and moved out, go around the property and take photos of it again. Make a note of any changes or damage compared to the original photos. Date and sign printed out photos or a statement confirming their authenticity. If possible, have your tenant do the same. You can use this as evidence to protect your right to the security deposit.

Camera against yellow background.
Photographs are the best way to prove the property’s condition.

Notify your tenant about the status of the deposit in writing

Keep your tenant notified of the status of their deposit in writing. When they move in, provide them with the information of which account and bank hold the deposit. If any interest is applicable, include the amount.

After your tenant moves out, you must inform them of how to get their deposit back. There may be a legal timeframe for this. If you’ve kept any amount of the deposit, provide an itemized list of reasons why. Once your tenant changes their address after moving, you can send them a letter about this. If they don’t provide you with a forwarding address within 30 days of moving out, you may not be legally required to return the security deposit.

Always follow the laws of your state (or you might end up in court)

Make sure to look into all laws applicable to security deposit in your state, city, and county. This includes laws about the amount of the deposit, how it is kept and even whether the tenant is informed of this or not. If you do not follow these rules, you may end up in a small claims court. Your tenant can file a claim here to get their deposit back.

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From Brooklyn, NY

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