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Old 04-01-2012, 05:12 PM
 
15 posts, read 39,291 times
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Default How much should a landlord keep from a holding deposit?

I went to look at a one bedroom apt in San Diego. The owner / landlady said she needed to make a decision right away, so I put in an application. She checked a few references and told me I was accepted.

I deposited $400 into her Chase account that evening, to hold the apartment, or as proof of my intention to rent. Nothing was signed at this point. I wanted her to know that I did indeed intend to rent.

The next day we met at the apartment to sign the lease and for me to pay the rest of the deposit + rent. I had it in cashier's check.

When I got to the place, I realized how small and dingy it really was, and decided against renting it. I have a young child and I had to make the best decision for my family, even though I felt bad because the landlady seemed nice.

I told her that I was really sorry but wouldn't be renting. I told her she could keep some of the deposit, because I had caused her trouble.

A few e-mails later, and now she is stating that she will keep all $400. for lost rent, etc. I deposited the 400 in her account at 5 p.m. , and backed out of the agreement at 1:30 the next day, so it wasn't even 24 hours. She says she had a tenant lined up already but chose me, so she lost that rent.

I don't want to be a jerk and I am not necessarily even going to try to get that money. I am just wondering what her expenses might be; that is, how much can she reasonably claim to have lost in such a short time? $400 seems quite excessive, especially since we never signed anything at all.

Thank you for any insight!

p.s. I do recognize that it was foolish not to have signed anything.
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Old 04-02-2012, 07:33 AM
 
Location: St Thomas, US Virgin Islands
21,631 posts, read 25,212,126 times
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The point in your favor here is that you didn't sign a lease and you did let her know very quickly that you weren't in fact going to do so.

My suggestion is that you send her a nice email and point out to her exactly those facts. Tell her that you're more than happy for her to retain a reasonable amount of the deposit for her trouble and to cover the cost of advertising, but that you're under no legal obligation to forfeit the total amount. "Looking forward to hearing from you at your earliest convenience to resolve this matter quickly", etc. and leave it at that.

Hint - if she doesn't respond within a week, send her the same letter via return receipt certified mail. That's often enough of a nudge to indicate that you're serious about pursuing it.

Good luck!
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Old 04-02-2012, 09:11 AM
 
Location: southwest TN
6,619 posts, read 7,061,000 times
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Since you provided no info about your location, it's difficult for anyone to give you complete information. However, you might want to look up your state's landlord-tenant laws - check the sticky. Additionally, you might want to check out your state's small claims court requirements.
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Old 04-02-2012, 09:12 AM
 
Location: Boise, ID
5,361 posts, read 10,235,040 times
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Two questions:

1. How busy is the rental market in your area? (ie how hard is it to find a place to rent)? If it is really busy, she will have it rerented very quickly and will be out almost nothing. But if it is slow, and she lost someone else because you said you were going to take it, and it takes her another month to find someone else, then a larger amount would be fair.

2. How much was the rent? Even in a busy market, if the rent was $2000, and it takes her a week to find another tenant, she is out $500. But if the rent was $400, and it takes a week, then $100 might be what is fair.

Advertising costs are $0 in my area. Craigslist is free, and takes about 10 seconds to repost the ad. The time consuming thing is answering all the inquiries, and showing the property. And the only real expenses are utilities, which are minimal on a vacant unit, and lost rent.
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Old 04-02-2012, 10:24 AM
 
4,587 posts, read 5,707,930 times
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our holding fee was $100. If approved and accepted, it went towards the total due at move in. If approved and reject by tenant..it's kept by the complex.
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Old 04-02-2012, 10:57 AM
 
15 posts, read 39,291 times
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Hi. Thanks for your responses.

I am in San Diego, CA.

The rental market in my area is hopping. I live in an urban, fairly desirable neighborhood with many apartments and condos. I would imagine she'd be able to rent it again fairly soon - or she would be if she lowered the rent a little for such a small place.

The rent was $950. I looked on CL and she hasn't put her ad back up yet, so she's clearly not trying too hard.

Her claim seems to be that I cost her rent, because she could have chosen someone else. I don't disagree with this, but I think that my penalties should be for cost of advertising and a bit more.
Am I liable (ethically) for as long as it takes her to find a new person, at a dollar cost of 1/30th the rent per day? Or is there some kind of statute here?
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Old 04-02-2012, 11:20 AM
 
Location: St Thomas, US Virgin Islands
21,631 posts, read 25,212,126 times
Reputation: 22316
Quote:
Originally Posted by Lacerta View Post
... if it is slow, and she lost someone else because you said you were going to take it, and it takes her another month to find someone else, then a larger amount would be fair.
Even that sounds to me as though she's being a little tricky. According to the timeline provided by the OP, she had all of just a few hours overnight with the $400 deposited to her account but no signed lease and in that short space of time she tuned down other applicants who wanted the place? And couldn't get them back just a couple of hours later? I don't know ...

OP, just send her the email and then start reading up on your state landlord tenant laws as NYAnnie suggested. If they're not linked in the first "sticky" on this forum page, just google, "(your state) landlord tenant laws" to find them. You can narrow the search by looking for holding deposits, down payments, whatever.
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Old 04-02-2012, 11:50 AM
 
Location: South Jersey
800 posts, read 1,190,730 times
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I'm confused. Was there no lighting when you went to look at it the first time? I would never put money down on something unless I was absolutly sure I wanted the item.
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Old 04-02-2012, 12:39 PM
 
Location: Austin, TX
14,312 posts, read 20,082,323 times
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Here is your answer on the State of California landlord-tenant laws website:

California Tenants - California Department of Consumer Affairs (http://www.dca.ca.gov/publications/landlordbook/looking.shtml - broken link)

Quote:
HOLDING DEPOSIT

Sometimes, the tenant and the landlord will agree that the tenant will rent the unit, but the tenant cannot move in immediately. In this situation, the landlord may ask the tenant for a holding deposit. A holding deposit is a deposit to hold the rental unit for a stated period of time until the tenant pays the first month's rent and any security deposit. During this period, the landlord agrees not to rent the unit to anyone else. If the tenant changes his or her mind about moving in, the landlord may keep at least some of the holding deposit.
Ask the following questions before you pay a holding deposit:
  • Will the deposit be applied to the first month's rent? If so, ask the landlord for a deposit receipt stating this. Applying the deposit to the first month's rent is a common practice.
  • Is any part of the holding deposit refundable if you change your mind about renting? As a general rule, if you change your mind, the landlord can keep some—and perhaps all —of your holding deposit. The amount that the landlord can keep depends on the costs that the landlord has incurred because you changed your mind—for example, additional advertising costs and lost rent.
You may also lose your deposit even if the reason you can't rent is not your fault—for example, if you lose your job and cannot afford the rental unit.
If you and the landlord agree that all or part of the deposit will be refunded to you in the event that you change your mind or can't move in, make sure that the written receipt clearly states your agreement.
A holding deposit merely guarantees that the landlord will not rent the unit to another person for a stated period of time. The holding deposit doesn't give the tenant the right to move into the rental unit. The tenant must first pay the first month's rent and all other required deposits within the holding period. Otherwise, the landlord can rent the unit to another person and keep all or part of the holding deposit.
Suppose that the landlord rents to somebody else during the period for which you've paid a holding deposit, and you are still willing and able to move in. The landlord should, at a minimum, return the entire holding deposit to you. You may also want to talk with an attorney, legal aid organization, tenant-landlord program, or housing clinic about whether the landlord may be responsible for other costs that you may incur because of the loss of the rental unit.
If you give the landlord a holding deposit when you submit the rental application, but the landlord does not accept you as a tenant, the landlord must return your entire holding deposit to you.

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Old 04-02-2012, 02:25 PM
 
15 posts, read 39,291 times
Reputation: 13
Thank you for posting the applicable laws. I see that it says

"Is any part of the holding deposit refundable if you change your mind about renting? As a general rule, if you change your mind, the landlord can keep some—and perhaps all —of your holding deposit. The amount that the landlord can keep depends on the costs that the landlord has incurred because you changed your mind—for example, additional advertising costs and lost rent."

That's really what my question is. How much did I cost her? From her perspective.
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