How To Rent Your House Now Blog

When I rent a house I take F/L/SD. This means “First Month’s Rent, Last Month’s Rent and a Security Deposit.”

If the tenant cannot come up with it I take “First Month’s Rent and Security” because my municipality does not let me dip into the last month’s rental deposit to pay for things such as damaged floors, doors, etc.

However, you have to be very careful these days with the laws surrounding this tenant security deposit.

I’m a People’s Court Junkie. I have seen about 5 cases recently where a Landlord keeps the tenant’s security deposit long after they move out for one reason or another (most were not valid reasons at all except the Landlord spent the money and didn’t have it to give back).

The problem arises when the tenant goes back to get it, and the Landlord incorrectly held it back, the tenant is then entitled to as much as three times the deposit. So on a $1500 deposit, you will owe them over $4,500 + legals.

If you are going to keep the deposit, be sure to have proof of damages in the form of before and after pictures, a move-in and move-out checklist and anything else possible. Also be sure to follow the procedure as outlined in your local “Tenant Security Deposit Act/Laws“. This may involve a time-sensitive letter so be sure to review your State/Province Act/Laws as soon as you become a Landlord.

Never be afraid to ask for these deposits as it may be the only way to get your money in an eviction situation — but also be fair with your tenant and give them their money back with interest if they are due it.