Security Deposits for Young Renters

I spoke with Jennifer, a leasing agent for a 22 building apartment community, located in Michigan. "Out of all our tenants, the college students and younger tenants are the ones getting less of their security deposits back." From what she witnesses, Jennifer says that this is due to reckless behavior and inexperience.For many young people, the combination of higher education, moving into a first apartment, and all the new things that go with living on one's own can prove to be exhilarating, and overwhelming all at once. Before moving into an apartment, it's beneficial to understand not only the responsibilities of being a tenant, but the responsibilities of landlords and rental management, as well. This could mean the difference between getting a security deposit back in full at move-out, and getting back nothing at all.  What Exactly Is a Security Deposit?An approved tenant provides an amount of money designated as a security deposit before moving in. This amount can not exceed the total of two month's rent. The deposit itself continues to be the property of the tenant, but serves to protect the property of the landlord. When the tenant moves out, the deposit is returned to the tenant in full, provided that the tenant has not damaged the rental unit. The cost to repair damages are deducted from the renter's deposit.Though basic principals are similar throughout the United States, security deposit law and tenant protections can vary from state to state. In some states, for example, tenants can earn interest on security deposits, while other states do not require landlords to place renter's deposits into interest bearing accounts. Researching local security deposit law will help clarify the specifics.A Security Deposit:

• funds the repair of damage to a rental unit, damage being described as anything beyond normal wear and tear
• protects landlords from broken leases and unpaid rent
• provides funding for missing items, like towel racks, lighting fixtures, etc.
• provides funding for excessive cleaning, and the removal of unclaimed items

Renter's DepositsYou may hear the words 'security deposit' and 'renter's deposit' used interchangeably, however; they are not technically the same. In conjunction with a security deposit, other deposits may also be required. The total of all deposits equals the 'renter's deposit'.Depending on the rental situation, a landlord may require any of these:

• security deposit
• 1st and/or last month's rent advances
• key deposits - funds the replacement of lost keys
• pet deposits - extra funding for damage caused by pets

It serves the tenant to go over separate deposits with the landlord in detail. Each allotted amount should only be used for it's designated purpose.PaymentThe first step to getting your security deposit back starts in the beginning. Proper documentation will increase the chances of getting back a renter's deposits in full.Upon payment of a security deposit, the tenant is given, by law, a deposit receipt. This receipt should include:

• the deposit amount
• a description of the dwelling unit
• the date received
• the name(s) of tenant(s) and the deposit recipient
• respective signatures

Security Deposit Itemization List for TenantsNew tenants are commonly given an itemization list, detailing apartment features and items. The tenant is responsible for  verifying the condition of each item. This list should be returned to the landlord as soon as possible. The itemized list protects both the tenant and the landlord. In the event that damages are found upon inspection, the tenant's security deposit cannot be reduced. The same list is completed again, at move-out, and any damages found are deducted from the tenant's security deposit.The perfect time to complete an itemized list is before one's belonging are all moved in. Tenants should take this opportunity to look everywhere, inspecting every nook and cranny. Pull on towel racks to make sure that they are firmly secured, poke around beneath the sinks, test all the doors and cabinet hinges, shelves, and lighting fixtures, look for water damage, etc. If possible, take photos of the listed items.Keeping a Rental in Good ShapeRegular maintenance helps to keep a rental in good shape. When repairs are needed, it serves the renter to attend to them, as small, neglected problems can cause larger, more expensive problems."We cover the cost of malfunctioning thermostats, refrigerators, and things of that nature," Jennifer says, referring to the policies of the apartment complex where she is employed. It's important to mention that repair stipulations vary, but normal wear and tear is commonly covered by the landlord. However, Jennifer states "When a tenant damages property, we can not deduct the cost of those repairs from the security deposit of the tenant while they are living in the apartment. The tenant is required to pay for those repairs out of pocket."
RoommatesRoommates often split security deposits, but it's important for young people to know that the total deposit amount is not placed into separate accounts. Payment for damage is taken out of the entire groups deposit. So, it helps immensely if everyone is on the same page, and aware of the importance of keeping their living space in good shape.GuestsTenants are responsible for any damage beyond normal wear and tear, be it caused by themselves, or guests. Let's be honest: young people are naturally active in general, and often notorious for rowdy parties. As a 23 year old, I can attest to this. Before situations get out of hand, renters should not hesitate to tell their guests that they are expected to respect the host's home. If damage occurs, try to work out an agreement with the responsible guest, as soon as possible. Get an intent to pay in writing, if you can.Before Moving Out Before moving out at the end of a lease:Make sure to give property owners 30 days notice in writing. If this is not done, rent can be lawfully deducted from the your deposit, until a new tenant is found. Fist and last month's rent advances are often required to protect against broken contracts.Give your landlord your new contact info in writing, making it easier for management to get your deposit back to you."What happens when someone breaks a lease, and their security deposit doesn't cover the remaining balance?" I asked Jennifer. "Well, whatever isn't covered by a tenant's security deposit, we assign that to a creditor, and the creditor attempts to collect from the former tenant."After  Moving OutOnce a tenant moves out, the owner of the property will do a walk-through inspection to determine if repairs are needed, comparing the original itemized list with the current state of the rental unit. Many renters don't realize that they have a right to be present at this time.Within 30 days, a landlord is required to return the former tenant's renter's deposit(s). When there are deductions taken out for repairs, replaced keys, etc., specific amounts should be detailed, and given to the former tenant.If you have not received your deposit within 30 days, send a letter of demand, providing full contact info. This can be sent to the manager of the property, the management company, and even the owner of the property. It's a good idea to follow up with a phone call, or even a scheduled office visit, but it's important to have something in writing.* * *Moving away from home can yield a sense of pride. Young adults can use this sense of pride and new found freedom to keep a rental in good shape. Care and maintenance, combined with documentation and communication will aid the renter in getting all or most of their security deposit back. As I mentioned before, it's important to understand the renter's laws for your state, and always examine the fine print before signing.