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Doesn't NJ state law limit the amount of a security deposit to 1 1/2 months rent?
All my rentals are in Philadelphia. Up to 2 month worth of rent for security at lease signing and no more than 1 month worth of rent after 1 year lease.
When you return the security deposit in accordance with your state laws you deduct from it any monies owed whether for damages or unpaid rent. If this uses up all the security deposit you still are required to write to the tenant and itemize the deductions. !
Not all states permit use of security deposit for rent. In fact, some states prohibit it, retaining security deposit solely for damages.
Not "use of" such by the tenant but I believe in all states a landlord can deduct from the security deposit both damages and any rent owed.
I believe that is the case. Landlord can use security for rent. Tenant need permission from landlord to allow use of security for rent. When tenant terminate the lease, security is used to cover damages and any back rent.
They are hoping that the landlord will think it is too much bother to take them to court
when the landlord knows that the tenant will be leaving, anyway.
They are knowing that... because it almost always is.
From a landlord perspective, what I see is a lot of tenants are under the impression that they have a last month rent in their deposit. When I get a new applicants, I tell them that that they need three months of rent to move in. Their initial response is usually oh "so you need first, last and one month security?". My response is NO.. first month rent and 2 months worth of security deposit. They say they understand. Now they move in and when there lease is up and they are giving me notice that they will not renew...when I am given this notice, they usually say that they will not be paying rent the last month since I have their last month rent. This is where I have to remind them the lease they signed. 2 months security deposit, not last month and security. I tell them they are free to not pay me rent that last month but I will tack that late fee from the security deposit.
Now most of my tenants have been good and almost all have gotten their full security deposit back. The way I see it is if they cause damages beyond your deposit, you can take them to court. If we are not talking large sum here, it's just the cost of doing business. I chose to lose a few hundred dollars over having a pissed of tenant leaving my property. It takes little to do lots of damages to your property.
The question is, how is it written in your lease? Are you collecting the max security that is allowed by your local authority? If not, time to change that. In my area, I collect 2 months at lease signing and return 1/2 of that after lease renewal.
You know, that is a brilliant idea. They will want their 2 months security deposit back, so this is a good idea. but i hope the rent itself is not so high. Because it would be expensive if your apartment was here in the city where it is typically $1,500 per month rent. That would be so expensive making it $4,500 to move in. And it is good you worded it like that because even though you are taking in 3 months of "rent/security deposit" if they defaulted, they would get more or less money depending on the verbiage.
You know, that is a brilliant idea. They will want their 2 months security deposit back, so this is a good idea. but i hope the rent itself is not so high. Because it would be expensive if your apartment was here in the city where it is typically $1,500 per month rent. That would be so expensive making it $4,500 to move in. And it is good you worded it like that because even though you are taking in 3 months of "rent/security deposit" if they defaulted, they would get more or less money depending on the verbiage.
My rents are between $900-$1100 month. It is so true that applicants have trouble with 3 months worth of rent at once. I find that once I go beyond $1100. It is very difficult and I stayed away from those types of rental now. I had one large 3 story home that I tried to rent out last year for $1500 month. It was a good deal in term of rent but most of my applicant had trouble coming up with $4500 to move in. I eventually sold the property instead of renting it out.
I've made it a point now that I will only work with rental that are around $1/sq. ft in the area where I have my rental. Anything properties that command too much rental, I rather flip the property.
Now even at $900/month. I have folks that are having trouble coming up with that.
Provided all else is satisfactory (background check, references, employment, etc.) many landlords will work with a tenant where security deposits and last month's rent are concerned and will allow the payments to be stretched over a couple of months.
It would be great to get two month's rent as a security deposit, but realistically, renters don't have that kind of money, or they wouldn't be renters, and what would stop them from not paying the rent two months before they leave?
Since the rental agency has 250 other properties, and has been doing it for 20+ years, I hope they have a plan in place.
My super son, a soldier who is still upside down by about $10k, is the homeowner, and I just want to help him sort it out.
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