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A co-worker looked at an apartment and decided he wanted to move in. He put down a deposit for them to hold the unit until his move in day. The landlord wanted him to sign the lease on move in day (which is a little unusual to me).
When he went to sign the lease, there were many things in there that he was not comfortable with (tenant agrees to have $150 taken out of deposit for carpet cleaning, tenant is responsible for a portion of all repairs). He told the landlord he was not signing anything and wanted to back out and wanted his deposit back. The landlord is not wanting to refund the deposit. There was no mention by either party is the deposit was refundable or not.
Is this common to not return a deposit in circumstances like this? What could my co-worker have done to avoid this? I suggested that he ask to review the lease and policies beforehand, but I've never heard of asking to see a lease or policies sheet before actually sitting down to sign the lease.
What state? Normally, a deposit can not be asked for prior to seeing/reviewing a lease. That would be unlawful and unethical at best. And a security deposit can never be considered a 'nonrefundable' deposit. Most, if not all, states have strict guidelines as to what can and can't be deducted from the security deposit.
What state are you in? In AZ if I took a holding deposit and you backed out I keep the holding deposit. If you sign a lease and occupy then the holding deposit goes toward the rest of the lease. I could demand a $300 holding deposit and it would be considered 100% legal to keep it in the circumstance you laid out. The AZ standard application spells this out plain as day in a very lengthy paragraph, which also says if I reject then your holding deposit is returned.
The state you are in is very important to answer your question though. As for asking to see a copy of the lease beforehand you can do that and most landlords will comply, I would rather you understand the agreement before I give a brief rundown of it.
What state are you in? In AZ if I took a holding deposit and you backed out I keep the holding deposit. If you sign a lease and occupy then the holding deposit goes toward the rest of the lease. I could demand a $300 holding deposit and it would be considered 100% legal to keep it in the circumstance you laid out. The AZ standard application spells this out plain as day in a very lengthy paragraph, which also says if I reject then your holding deposit is returned.
The state you are in is very important to answer your question though. As for asking to see a copy of the lease beforehand you can do that and most landlords will comply, I would rather you understand the agreement before I give a brief rundown of it.
^Agree. What kind of a 'deposit' was it? Security deposit or some other kind of deposit like a 'holding deposit'?
If it was an actual 'security deposit' then they can't signify it as nonrefundable. Here are the only reasons money can be withheld from a security deposit in Iowa. http://coolice.legis.iowa.gov/Cool-I...t=562A#562A.12
But if it was some other kind of deposit, that will make a difference.
-There should have been something signed that said whether the deposit was refundable.
-Part of the reason that some deposits are not refundable is the idea that a LL may lose out on other tenants during the waiting period. So the length of time might be relevant.
-Of course it's reasonable to ask for the lease in advance. On my first leases, I took it to someone in the legal department in my company to read.
-The two examples you mention, a cleaning fee and some repair responsibility, are fairly common.
I suggested that he ask to review the lease and policies beforehand, but I've never heard of asking to see a lease or policies sheet before actually sitting down to sign the lease.
Quite the contrary. Before paying ANY money to a LL you should review the lease.
The lease was equal to the first months rent. If he had signed the lease, he would have only needed to pay the rent, no more deposit. Based on that fact, I'm considering it to be a security deposit.
AZ Manager, when you collect a holding deposit, do you tell the renter that it's non-refundable?
I've never had to pay a deposit for an apartment to be held. However, this is because I've signed the lease right after being approved. I provided the landlord with the security deposit as the lease was signed. However, I've heard of paying a non-refundable fee to hold an apartment (which would be later applied to rent or security deposit after the lease is signed).
Quote:
Originally Posted by Corn-fused
Quite the contrary. Before paying ANY money to a LL you should review the lease.
Apparently he asked to sign the lease before move in (the day the deposit was paid), but the "broker" makes the lease the day before move in. The LL stated that they are not carbon copy leases. The landlord is a property management company.
Apparently he asked to sign the lease before move in (the day the deposit was paid), but the "broker" makes the lease the day before move in. The LL stated that they are not carbon copy leases. The landlord is a property management company.
Doesn't matter. You should still never pay any money, security deposit OR otherwise, until you have had a chance to familiarize yourself with, and have read the lease in its entirety.
And yes, it 'sounds' like they paid a 'security deposit' but until you find out for sure, then you won't be able to determine for sure if it is enforceable or not.
I would take them to small claims court immediately. If it was a security deposit and they don't return it within 30 days then your friend might be able to get more than that back.
As for it being a holding deposit, those are usually non-refundable. If it was equal to one month's rent who in their right mind would pay that if it's non-refundable? Either way I think a judge would frown on them keeping it. Some judges would be likely to award your friend double.
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