Landlord tips for Security Deposits

Security Deposit Tips for Landlords

The security deposit has long been a bone of contention between tenants and landlords. You can follow a few steps to avoid problems when it comes to security deposits.The bottom line is that security deposits don’t have to be scary and problematic.
This post will provide guidance for property managers, landlords, or anyone who wants to navigate the world of security deposits. It will discuss the laws in each state, provide advice from landlords and property managers, and address some of the most commonly asked questions about security deposits.

1. Know the laws in your state. Learn where you keep deposits, how much you can collect, how quickly it needs to be deposited into the bank, whether and how interest should be paid, required reports, etc. It’s important to understand that security deposits for residential properties are controlled by statute and call for nondiscriminatory and equal treatment. It is a prohibited discriminatory practice to charge a family a different amount then an applicant without children. It is also prohibited by law to require an excessive amount for the security deposit. Check the laws pertaining to security deposits in your state for similar guidelines in your area.
2. Don’t be tempted to charge less than you’re entitled to charge for a security deposit.
3. Keep security deposits in a SEPARATE account. ! DO NOT MIX THE SECURITY DEPOSIT AMOUNT WITH ANY OTHER FUNDS IN ANY OTHER ACCOUNT. IT MUST BE HELD SEPARATELY. Make sure your bank knows the deposit account is for “escrow†funds. This will prevent forfeiture of those funds.