Where is the security deposit? That shouldn’t be a complicated question. Dealing with security deposits should not be scary or problematic. The security deposit can help avoid headaches down the road and should be considered on loan from the tenant during the lease. You are responsible for its safe keeping to either return or offset damages. Following a few basic steps can avoid problems down the road when it comes to security deposits.
- Know the laws; in Florida learn the Landlord and Tenant Act.
- Establish a separate trust account for security deposit funds; never ever commingle funds.
- Don’t offer a lower amount just to get more prospects; security deposits can help avoid headaches down the road.
- Don’t treat security deposits as extra rent; pending that there is no damage, security deposits are returned to the tenant.
- Document the condition of the home just prior to move in; photos and videos are great for this.
- Just because you can, doesn’t mean that you should handle escrow monies; if you are not trained then hire someone who is.
- Make sure the property owner is in the loop; communicate your policies and procedures for security deposits with them.
Whether you deduct for damage or not, Florida has rules about the allotted timeframe for refunding the security deposit after a tenant vacates. The security deposit must be refunded in full within 15 days or by day 30 if damages are claimed against it. If damaged are claimed, the tenant must be provided a detailed list of damage and the cost of all charges against the deposit by certified mail within 30 days. If you fail to do this, you lose the right to deduct anything…no matter how much damage the tenant caused.
What Does Florida Law Say?
Whenever money is deposited or advanced by a tenant on a rental agreement as security for performance of the rental agreement or as advance rent for other than the next immediate rental period, the landlord or the landlord’s agent shall hold the total amount of such money in a separate non-interest-bearing account in a Florida banking institution for the benefit of the tenant or tenants. The landlord shall not commingle such moneys with any other funds of the landlord or hypothecate, pledge, or in any other way make use of such moneys until such moneys are actually due the landlord.