When someone rents a place to live, they usually have to pay a security deposit. This is something that protects your rentals, and it is important to understand how they work as a landlord. But did you know that only 41% of renters expect to get their security deposit back?
Landlords want renters who will take care of their property, and that will result in getting a full deposit back. In this article, we'll cover everything you should know and talk about security deposits and how to collect them properly.
What is a Security Deposit?
A security deposit is money that a renter pays to a landlord at the beginning of their lease. This money is held by the landlord to cover any damages the renter might cause during their stay.
If the rental property is left in good condition, the landlord returns the deposit to the renter when they move out.
Security deposits are common in rental properties of all kinds. Whether you're renting an apartment, a house, or a room, you'll probably have to pay a security deposit.
Landlords can use the deposit to cover things like broken appliances, stained carpets, or holes in the walls.
Security Deposit Laws
Security deposit laws are in place to protect renters from unfair practices by landlords. These laws vary by state, but they generally cover several important aspects of security deposits. Here are some common laws that landlords need to be aware of:
In some states, there is a limit on how much a landlord can collect as a security deposit. This is to prevent landlords from charging excessively high deposits that may be difficult for renters to afford.
Many states require landlords to return the security deposit within a certain timeframe after the tenant moves out. This timeframe can range from a few days to a few weeks, depending on the state. Some states require landlords to provide an itemized list of deductions if they use any portion of the deposit to cover damages.
Most states require landlords to hold security deposits in a separate account, apart from their personal funds. This is to ensure that the deposit is not spent or mixed with the landlord's personal finances.
Landlords are generally required to provide written receipts to tenants when they collect security deposits. This receipt should include the amount of the deposit, the date it was collected, and a description of the rental property.
Collecting a Security Deposit
When a landlord collects a security deposit, they have to do it properly. This means giving the renter a written receipt, as we mentioned before. The landlord also has to hold the deposit in a separate account, so it doesn't get mixed up with their personal funds.
When the renter moves out, the landlord has to inspect the rental property and make a list of any damages. If there are damages, the landlord can use the security deposit to pay for them.
Protect Your Property Today
Security deposits are an important part of renting a property. Landlords need to know the laws in their state and follow them when collecting and returning deposits. Renters should also understand their rights when it comes to security deposits.
If you are a landlord and need help with these topics, reach out to Advantage Property Management Services. Trained professionals can help you with all of your property needs.