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6 basics of security deposits of your rental property - Frank Roessler

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Frank Roessler discusses 6 basics of security deposits of your rental property in this in-depth presentational blog. For more information, please visit http://ashcroftcapitalrenovations.com!

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6 basics of security deposits of your rental property - Frank Roessler

  1. 1. 6 BASICS OF SECURITY DEPOSITS OF YOUR RENTAL PROPERTY Frank Roessler ASHCROFTCAPITALRENOVATIONS.COM
  2. 2. As a property owner, it’s important to understand what a security deposit is and how it may be used. Essentially, the security deposit is a fee that you collect along with the first month’s rent when you rent a unit out to a new tenant. The deposit is intended to be refundable under most circumstances and can only be collected one time. ASHCROFTCAPITALRENOVATIONS.COM INTRODUCTION
  3. 3. The answer to that question depends on the state, county, and local laws in your area. Many states, such as Texas and Illinois, do not limit the amount a property owner can request as a security deposit, but that doesn’t mean there aren’t city or county laws restricting what can be requested. In many areas, landlords may only request a deposit equivalent to three months rent or less, so it’s important to know the laws in your area. How Much is a Security Deposit?
  4. 4. DO YOU ALWAYS HAVE TO COLLECT A SECURITY DEPOSIT UP FRONT? While you’re not required by law to collect a security deposit, it has become a standard practice and it’s the best way for you to protect yourself. Some tenants may claim they don’t have enough money for the deposit and request that you allow them to make payments. If you agree to this, you’ll likely never receive the full deposit amount and you’ll have to pay for damages out of your own pocket. It’s better to look for a more desirable tenant. ASHCROFTCAPITALRENOVATIONS.COM
  5. 5. In some states, you can save the deposit however you choose, but most states have strict regulations. In addition to supplying the tenant with a receipt that shows where the money is stored, you may be required to place the money in an interest-bearing account. You may also be required to supply the tenant with annual reports on the interest earned in the account. What Do You Do With the Deposit?
  6. 6. HOW IS THE DEPOSIT TO BE RETURNED? Once the lease has ended, many states give the landlord just 15 days to return the deposit to the tenant. Some states grant 30 days. If the money isn’t returned in the allotted time, the tenant must be provided with written reasons as to why the security deposit wasn’t returned. While the security deposit helps you recover losses, you must return it in full in most circumstances. Most states outline the conditions in which you can keep the deposit, but, primarily, you can only keep it to cover the costs of repairing damage caused by the tenant or as compensation for the nonpayment of rent. If you’re unsure about the laws in your area, it may be wise to consult a real estate attorney about security deposit restrictions in your area. ASHCROFTCAPITALRENOVATIONS.COM
  7. 7. THANK YOU! ASHCROFTCAPITALRENO VATIONS.COM ASHCROFTCAPITALRENOVATIONS.COM

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