Security Deposits and How Do They Work?
If you are wanting to a rent a property, you are most likely going to have to pay a security deposit. So what is it for?
Your security deposit is most commonly worked out at two (2) months of rental payments. It can be thought of as a bond while you live in the property. It gives the property owner financial security if you leave without paying some rent or if there is damage to the property in some way.
If there are no problems after you leave, you can expect to get your security deposit back shortly after you move out.
Things to know about security deposits
Here’s a quick rundown on security deposits:
1. How to pay?
Generally, the security deposit is two months worth of rent, however it can vary. The total amount of security deposit required will be noted in the leasing contract and payment will usually be required at the time of signing the agreement.
2. How do I get the security deposit back?
When you move out, the property owner or the leasing broker will inspect the property for signs of damage and check if all rent has been paid up to the time you move out.
If you are up-to-date with your lease payments, the property has not been damaged, and the home is cleaned to the same standard it was when you moved in, the security deposit will be released to you.
However, if there are issues found during the inspection, the property owner can withhold money from your security deposit to cover the costs of rectification. This fact is typically noted in the lease agreement. However, note that normal wear and tear on the premises is not considered damage and should not be a reason for the property owner withholding the security deposit back.
An important tip to help you get your security deposit back is to thoroughly inspect the property before you move in and document any existing damage to the property. Keep evidence of the damage with pictures and/or video walk-throughs of the property. Also try to get the property owner to fix any issues before you move in.
3. When do I get the security deposit back?
Generally within about 30 days. The property owner will hold back payment for this 30 day period in the event that there are outstanding bills such as electricity, cable TV, internet services, water, etc. The exact timeframe should be noted in the lease agreement so ensure this fact is noted in writing to avoid issues after you move out.