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What Can a Landlord Deduct from a Security Deposit?

When a tenant is about to move into your rental property, he will be paying you a security deposit. A security deposit is a sum of money that you collect on top of the first month’s rent.

Think of a security deposit as a form of financial protection in case your tenant damages anything in your property or fails to pay the rent. 

Each state has a specific law as to when you, the landlord, should return the security deposit. In California, it’s within 21 days after the renter surrenders the property to you.

Now you may be asking, “What can a landlord deduct from a security deposit?” In today’s post, we’re going to answer this question.

What Can a Landlord Deduct from a Security Deposit?

Below are common reasons to keep a portion or all of a tenant’s security deposit.

Your tenant breaks the lease

Breaking the lease is one reason to deduct from the security deposit. A common scenario is that a tenant leaves the rental after six months when he signed a one-year lease. Remember that the lease agreement is a legally binding contract. Your tenants are responsible for meeting the terms since they signed it.

Cleaning costs

Just because a tenant has failed to take out the trash, doesn’t mean you can immediately deduct from the security deposit. You can deduct if a lot of cleaning has to be done. Not to mention, a few things need to be replaced because they were excessively soiled (your carpets, for example).

Damage to your property

Take note that damage is different from normal wear and tear. “Wear and tear” happens as a result of your property getting older. For example, mildew forming on the bathroom tiles.

Damage, on the other hand, results from a tenant’s neglect or abuse of the property. Examples include large holes, broken appliances, a broken bathroom seat, and carpets soaked with pet urine.

To be sure that damage occurred in the rental, review your move-in inspection checklist. You should have pictures that show the original condition of the rental.

Unpaid utility bills

Electricity, gas, and water are just some of the utility bills that renters may be responsible for paying. If you require your tenants to pay them as stated in the lease, you can deduct from the security deposit if this responsibility isn’t met.

Final Words

As a landlord, you can prevent disputes from happening by giving your tenants the chance to make things right. Allow them to explain what happened and repair the damage. During the rental period, keep your communication lines open. Keep necessary receipts!

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