Renting our house, how much of security deposit due at signing?
April 18, 2009 by Builder Wong
Filed under Security & Protection
This will be a 1-year lease, 00/month, 00 confidence deposit.
At signing, how most of a confidence deposition should you ask – 0, 1000,….? Can you have this non-refundable?
They move-in date is May1st, though we wish to pointer an agreement as well as get partial of a confidence deposition now.
In my 68 years on this planet, I've lived and rented apartments and houses in 5 states and probably 50 different cities. With some rentals, the landlord asked for the first and last months rent plus a security deposit equal to one months rent, all up front!
Your asking 2k per month and 2k security deposite ashould be no problem for anyone willing and capable, financially, to pay that exhorbant amount of money for rent! You really must have a truly fabulous place!
As far as making the security deposit non-refundable, I would think you would have to change the wording in the lease identifying that item as something other than a deposit. Possibly just a "fee".
Good luck on finding someone with that kind of cash lying around, just to give away for nothing.
ask for half and no, don't make it non-refundable.
You already said how much the security deposit is…..
Usually damage deposits/security deposits are half of the first month rent. Sometimes people have it non refundable, others have it refundable if they place is left in good shape
Generally the full security deposit is due before the tenant takes possession.
Second, security deposits are just that, deposits, so must be made refundable UNLESS the tenant damages or doesn't pay rent. You need to state explicitely what the deposit covers and what it doesn't. You also need to check your state/city laws concerning landlords rights to keep deposits. Some states are really tough on you guys and tell you exactly when you have to return the money.
One more thing, it is really wise to take the tenant and a camera, movie works best, but regular camera will work too on a walk through the day they take possession. You want pictures of the tenant in every room and pics of all appliances, inside and out and every wall, ceiling and floor throughout the house. Trust me if they trash your house the pictures will save your butt in court.
You can't make a security deposit non-refundable unless there are terms which were broken. The money is a security to you because of possible damage or non-payment of rent. As you mentioned $2,000 security and then asked if it should be $500, $1,000, security should be based on credit report, previous landlord and employment verifications. Please include all three!
IMO – you should have first and last months rent up front. Then a security deposit that is refundable if there is no damage or excessive cleaning that needs to be done at the end of the lease. I don't mean every day living damage, I mean holes in the walls or floors, burn marks, ruined beyond repair of carpet..etc. This can be paid half up front and then monthly there after.
First, security deposits are usually refundable – and made that way by law. The non-refundable fees are usually for pets, application fees, etc. The deposits are for your protection in case the tenant ruins things.
I would require the entire amount due at signing. If you want to do half now and half later – make the tenant sign a contract stating this. Most people ask for it up front.
I would like to know where you live – nothing rents for that amount around here! The only way a person would get close is separate contracts for college students.
If they aren't moving in until May 1st that is a lot of time that you have no income from the house. If they want it I would ask for the security in full right now. It is non-refundable only if they come to you before May 1st and tell you they have changed their mind. You can keep the deposit because you lost the chance to rent it during March and April.