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Is it lawful in Nevada to make a security deposit nonrefundable if you chose not to rent the property and did not sign a lease?
A rental company application I signed has a provision saying that your security deposit if you do not move into the property becomes non-refundable. I did not sign a lease nor see the property. The Nevada security deposit law is pretty clear what security deposits can be used for(rent, damages, cleaning only) and requires itemizations of costs, etc. It also says the only circumstance security deposits become nonrefundable is for cleaning costs. (NRS 118A.242) the rental company did not relist the property as available when it was, therefore I believe intentionally withholding the funds and costing proration. It was ready for move in Nov 15th and then when they relisted it they said it would be avail in December. It seems the company by doing so did not make a reasonable attempt to re-advertise the property.(considering applicants may have passed on applying because it wasnt readily avail), or there was issues with the property deeming it not available, only it was for myself. Am I likely to win this back in small claims? It clearly says on the application they will make your security deposit nonrefundable, they do not call it a holding fee.
Am I likely to win this back in small claims? It clearly says on the application they will make your security deposit nonrefundable, they do not call it a holding fee.
I disagree with MrRational.
NRS 118A.242
8. Except for an agreement which provides for a nonrefundable charge for cleaning, in a reasonable amount, no rental agreement may contain any provision characterizing any security under this section as nonrefundable or any provision waiving or modifying a tenant’s rights under this section. Any such provision is void as contrary to public policy.
Is it lawful in Nevada to make a security deposit nonrefundable if you chose not to rent the property and did not sign a lease?
A rental company application I signed has a provision saying that your security deposit if you do not move into the property becomes non-refundable. I did not sign a lease nor see the property. The Nevada security deposit law is pretty clear what security deposits can be used for(rent, damages, cleaning only) and requires itemizations of costs, etc. It also says the only circumstance security deposits become nonrefundable is for cleaning costs. (NRS 118A.242) the rental company did not relist the property as available when it was, therefore I believe intentionally withholding the funds and costing proration. It was ready for move in Nov 15th and then when they relisted it they said it would be avail in December. It seems the company by doing so did not make a reasonable attempt to re-advertise the property.(considering applicants may have passed on applying because it wasnt readily avail), or there was issues with the property deeming it not available, only it was for myself. Am I likely to win this back in small claims? It clearly says on the application they will make your security deposit nonrefundable, they do not call it a holding fee.
And the receipt you received after paying these funds clearly states, ‘security deposit’? I ask because normally you a no refundable holding fee to hold the unit and pay the security deposit when you sign the lease
Yes it clearly does as well as the memo on the cashiers check I gave. In the application a section says specifically if you do not move into a property you are approved for the security deposit and 1st months rent becomes nonrefundable for missed opportunity to rent to other applicants, and if rented sooner they may give a prorated refund. It does not mention holding deposit which if tweaked a bit I can see how I would be screwed. I.e. if it said funds used to hold the property becomes transfered to your security deposit. But the verbage is clearly security deposit. Fortunately I never got far enough for the rent part, but as I said nevada law seems pretty firm as to what security deposits must be used for and any rental agreement stating other uses is void. I am just hoping a judge sees it that way, considering their job entails following the law. My area has a rental shortage and this property has had 20+ applicants. I am unsure how the owner will gauge the cost i cost her by backing out. I have tried to ask for the money back from the company and been ignored. It seems she has maybe never been sued for this because when people see they signed that paper they feel doomed, but based on that same law above it appears to me it is unlawful for her to ask specifically for the security deposit for backing out.
Yes it clearly does as well as the memo on the cashiers check I gave. In the application a section says specifically if you do not move into a property you are approved for the security deposit and 1st months rent becomes nonrefundable for missed opportunity to rent to other applicants, and if rented sooner they may give a prorated refund. It does not mention holding deposit which if tweaked a bit I can see how I would be screwed. I.e. if it said funds used to hold the property becomes transfered to your security deposit. But the verbage is clearly security deposit. Fortunately I never got far enough for the rent part, but as I said nevada law seems pretty firm as to what security deposits must be used for and any rental agreement stating other uses is void. I am just hoping a judge sees it that way, considering their job entails following the law. My area has a rental shortage and this property has had 20+ applicants. I am unsure how the owner will gauge the cost i cost her by backing out. I have tried to ask for the money back from the company and been ignored. It seems she has maybe never been sued for this because when people see they signed that paper they feel doomed, but based on that same law above it appears to me it is unlawful for her to ask specifically for the security deposit for backing out.
I'd definitely pursue the small claims case, even if just on principle.
I mean, I could see if you had signed a lease, but this is completely different. NV is pretty tenant friendly (at least on the commercial side from my experience) - I'd hit them with the case and see if they just refund it to save themselves the hassle.
The deposit it likely meant to convert to a SD upon commencement by payment of 1st rent.
(ie making it a forfeited holding deposit)
What do you mean? Since the clear term used is "security deposit". I am sure it is meant to do that, but does that hold up in court? Trying to go off of technicality here and the security deposit law for Nevada. I was okay with forfeiting some of it for backing out, but taking the whole thing and not listing the property as available, when it is, is intentionally screwing me I feel.
Thank you for the replies. I agree it is worth it also on principle. Security deposits are designed for damages to the home, the law states such here and nothing else on "holding" regulations I can find...but to take the whole thing for that reason is outlandish to me.
I was okay with forfeiting some of it for backing out, but ....
The forfeited money paid was seen by the LL as a holding deposit.
Without ever actually being a tenant there is no need for a SD.
Last edited by MrRational; 12-10-2019 at 03:24 PM..
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