Tenant leaving, niece wants to take over- should she stay or go?

[Brian Fazekas]

Hey BP,

I just bought my first rental and found out today that one tenant is planning on leaving in a few weeks.  She currently has a niece living with her (I inherited them from the purchase and the niece is not on the agreement),  and the niece wants to stay. The niece is probably 21 at the oldest, so I'm a little reluctant based on what I hear in regards to renting to college aged tenants.  The aunt just mentioned this all today and wants to forgo her security deposit and transition it to the niece. What do I do about the security deposit?  Do I have the niece fill out a rental application and new lease?  Not sure if this is a common thing.  I had originally planned to raise rent when one tenant left, so not sure if this is the best opportunity or not?

Any suggestions or advice would be helpful!

Thanks!

Brian