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AZ Manager, when you collect a holding deposit, do you tell the renter that it's non-refundable?
Taken straight out of my application.
Quote:
The earnest/holding deposit is refundable if my application is not approved (14-day delay required for bank clearance of check). If my application is approved, the earnest/holding deposit is credited to the required move-in costs. IF APPLICANT SHOULD WITHDRAW THIS APPLICATION WITHIN 7 DAYS AFTER WRITTEN NOTIFICATION OF ACCEPTANCE, a minimum of $__________ of the earnest/holding deposit WILL BE RETAINED in addition to the non-refundable application fee. IF AFTER 7 DAYS OF NOTIFICATION OF ACCEPTANCE, APPLICANT WITHDRAWS OR FAILS TO EXECUTE LEASE AGREEMENT, ALL EARNEST/HOLDING DEPOSIT MONIES WILL BE FORFEITED. UNDER NO CONDITIONS WILL APPLICATION FEE BE REFUNDED
I never actually take a holding deposit though if I were to this would cover me. My application is 3 pages and the last page is regarding holding deposits and authorization to run background checks.
Have your friend copy/paste the info in this link and send it to the LL certified mail/return receipt requested and ask that the full security deposit be returned to them in 10 days or you will sue them in small claims court.
They can even try emailing or calling the LL right away and state that they will sue them in small claims court for that total amount plus damages if it is not returned immediately to see if they will return it that way. But then also follow up with the certified mail demanding it be returned in 10 days so you have concrete proof.
Also, how long ago was it that they gave the check to the LL? Do they have time to stop pay on it? If it has not cleared the bank yet, I would stop pay on it immediately. (Again, this is only if it was designated as a security deposit. Process may change if any other kind of 'deposit'.)
It sounds more like your coworker paid a holding deposit instead of a security deposit.
I can't speak for all places obviously, but years ago I was looking for an apartment. I found a place that I liked, but I had another place that I wanted to look at before accepting an apartment in this place. The place told me that they would hold the unit for me for 1 week after I applied and that the hold would end at noon of whatever day that may be. For example, if I applied on Monday, the hold would end at noon the following Monday and the only thing I needed to pay for that hold was the application fee, which I believe was $50.
They then told me that if I wanted to hold the apartment longer, I could pay a certain amount and it would hold the unit for 14 days. This amount was equal to half a month's rent. I believe rent there at the time was around $450 so $225 for a holding deposit, which was non-refundable.
I ended up taking the other place I was going to look at, but if I hadn't liked it when I looked at it, I would have had no problem with the other place's policies about the hold.
It sounds more like your coworker paid a holding deposit instead of a security deposit.
I can't speak for all places obviously, but years ago I was looking for an apartment. I found a place that I liked, but I had another place that I wanted to look at before accepting an apartment in this place. The place told me that they would hold the unit for me for 1 week after I applied and that the hold would end at noon of whatever day that may be. For example, if I applied on Monday, the hold would end at noon the following Monday and the only thing I needed to pay for that hold was the application fee, which I believe was $50.
They then told me that if I wanted to hold the apartment longer, I could pay a certain amount and it would hold the unit for 14 days. This amount was equal to half a month's rent. I believe rent there at the time was around $450 so $225 for a holding deposit, which was non-refundable.
I ended up taking the other place I was going to look at, but if I hadn't liked it when I looked at it, I would have had no problem with the other place's policies about the hold.
One month's rent sounds like a 'holding' deposit/fee to you and that it be nonrefundable if they chose not to take the apartment especially without seeing the contents of the lease? That would be beyond outrageous and I doubt any judge would allow that if it were challenged.
A 'holding' deposit/fee of maybe $50 is one thing, but a full month's rent is a totally different story. Even still, if requested, a prospective tenant should be allowed to review a lease prior to putting any money down if they choose.
In my specific situation, I didn't care about the holding fee because I wasn't paying it. I would have only needed to pay the fee if I needed more time to decide after the first week. So I could have used the week that I got when I paid the application fee and then gone in before noon on that Monday or whatever day it was, paid the holding fee, and gotten an additional 2 weeks. I was seeing the apartment I eventually took the next day and decided that was the one I wanted almost instantly.
A prospective tenant is obviously entitled to review a lease prior to making the decision to move into a place. If a LL refuses to let the tenant review the lease, then that's a red flag and the tenant should stay away unless he/she has no other options.
I should also point out that I can understand the reasoning behind if from the LL's point of view. Let's say it's a small building, say 8 units with only 1 available unit. If I pay the holding fee, then it does no good to show the unit to other people because they can't legally rent it to anybody other than me during those 14 days. So if I want the full 14 days and then say no, the LL has lost that much income from that time that I was deciding. I've never been a LL, but I can see that from the LL's point of view. Now, tenants may not like it as much, but this way also forces them to be more responsible when looking for a new place to live. You have to assume that only a serious person would pay the money because it doesn't benefit them if they decide not to move in later on.
I should also point out that I can understand the reasoning behind if from the LL's point of view. Let's say it's a small building, say 8 units with only 1 available unit. If I pay the holding fee, then it does no good to show the unit to other people because they can't legally rent it to anybody other than me during those 14 days. So if I want the full 14 days and then say no, the LL has lost that much income from that time that I was deciding. I've never been a LL, but I can see that from the LL's point of view. Now, tenants may not like it as much, but this way also forces them to be more responsible when looking for a new place to live. You have to assume that only a serious person would pay the money because it doesn't benefit them if they decide not to move in later on.
Yes, that is clearly understood IF it is a holding fee of say $50 that it be nonrefundable. But not a full month's rent.
Quite the contrary. Before paying ANY money to a LL you should review the lease.
Does this include small application fees? Because I've read that landlords may not want to show lease prior to application approval. Unless it's a generic lease you refer to?
Quite the contrary. Before paying ANY money to a LL you should review the lease.
Does this include small application fees? Because I've read that landlords may not want to show lease prior to application approval. Unless it's a generic lease you refer to?
Does this include small application fees? Because I've read that landlords may not want to show lease prior to application approval. Unless it's a generic lease you refer to?
No, not application fees. (that is a whole other can of worms lol) Only holding fees, security deposit fees, etc.
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