Tenant unhappy about not getting deposit back

Tenant unhappy about not getting deposit back

Investor · Milton Florida · Member since 2010 · 51 posts · 12 votes

Hello,

I had my home rented out for about a year and a half, the Tenant signed the lease agreement in may of 12, the lease reverts to month by month after 1 year is up.

Anyway, she did not give me proper notice, the lease says 60 days by certified mail, she gave me less than 30 verbally. To make things more difficult I have moved to a different area, so I had to fly in fix the place back up which ended up being a very costly deal.

I let her know I would be holding the deposit to cover damages (materials & labor) and since she left on the 15th I would be nice enough to return half of her last months rent. She is still very unhappy, trying to make me feel like i'm just ripping her off. (she breached the contract so legally I don't owe her a penny)

So my questions:

1. What can I charge for my labor fixing things? I had some hired help but also myself.

2. What can she do legally? take me to court? would it be in that county courthouse? lease doesn't specify.

3. She put a sink cabinet in the bathroom and left it installed, she mentioned it, can she demand that back?

4. Should I just turn on dick mode and hold all monies? I am worried that I send her out this check and then she starts causing problems.

fyi: I took pictures of all the damages

Thanks for any input/help...

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Investor · Vancouver, WA · Member since 2013 · 3k+ posts · 4k+ votes
12y

Oops, clicked the wrong button and sent a post without my response to your questions.

1. Keep receipts for parts/materials, invoices for hired services, and yes charge for your labor if your jurisdiction allows it. We usually charge $20 per hour for our time, but in some situations (like really disgusting work) we have charged $30 per hour with no push back from the judge. We only have 14 days to return deposits or account for their withholding, so sometimes we must determine our costs before the repairs are complete. When tenants move-in we give them a list of customary charges for common damages, so they won't be blindsided. We give them the list again when we receive notice that they are moving. One of my favorite tools is HD Supply catalog because it gives prices on parts/materials for most anything needing replacement.

2. Yes she could file with the court, but why give her reason too? Whether a law suit has merit or is frivolous, it will still cost you time and money.

3. We have in our rental agreement: "ALTERATIONS: Tenant agrees not to alter the premises without prior written consent of Landlord. Landlord encourages Tenant to make the dwelling "their own home" and will allow a certain amount of decorating and modifications. However, all changes made by Tenant must be reversible and property must be restored to original condition at end of tenancy, unless other arrangement have been made with Landlord. Tenant agrees not to do painting, wallpapering or structural modifications to the premises. Tenant agrees not to make alterations, changes or additions to plumbing fixtures, light fixtures, heating units, or locks. Any alterations or decorations made by the Tenant become the property of the Landlord when Tenant vacates." That proactively covers it. If you didn't have an agreement in place that covers your situation, then be reasonable and in good faith negotiate a solution with the tenant.

4. Remain professional at all times. Only withhold the amount of security deposit that you are legally entitled to withhold. Follow proper procedure is compliance with landlord-tenant law. You may be inconvenienced, frustrated or angry by the tenants actions. Don't make it worse by your own actions. Remain calm and try to negotiate a win-win.

Let go of the 60-day notice concern. (Does your state allow you to require a 60-day notice? I thought it was 30-days in your state. Tenants do not waive their rights by signing contracts that are not in synch with the law.) When she gave you a 30-day verbal notice, you could have followed up by giving her some guidance to make the move-out process go more smoothly. Alas, you missed that opportunity this time. As you learn from this experience, you will become better at handling move-outs.

Here is our process, if you care to borrow it:

If a tenant informs us verbally of their intent to move, we remind them they must give us a written notice as per their rental agreement. We provide tenants with a Notice to Vacate form and move-out instructions at the time of move-in. By the time they decide to move, they have often misplaced the form, so we give them another one as soon as we hear wind that they are considering moving. They don't have to use our form, it just makes it easier for them and provides us with what we need.

When we receive their written Notice to Vacate, we mail them an acknowledgement letter that states the date of our receipt of the notice, the date we understand they will be out and what happens if they can't make it out by that date. We give them the move-out instructions again, which includes a list of common charges for damages. We remind them of the amount of their security deposit and what they must do to receive it back. Our forms and instructions reference applicable landlord-tenant law.

We keep an eye on the property to get an idea if they are preparing for their move and make a note if we observe a moving truck. If we do, are items being moved out or moved in? Believe it or not, we were evicting a tenant, saw the moving truck and thought YEAH! she really is moving! Until we noticed she was moving more items into the apartment, from a storage unit that had rent past due.

We ask the tenant to contact us to schedule a date and time for the move-out inspection. We prefer to do the move-out inspection with the tenant. We start by asking the tenant to show us any known damages. Then we ask the tenant anything in the unit is not working or needs repair. We point out any deficiencies that are beyond normal wear and tear and give the tenant a chance to take care of those.

We have had tenants clean an oven right then and there; we have also had tenants tell us to just deduct the cost of the oven cleaning from their security deposit. I never make promises to the tenant about how much of the security deposit they will get back. I do take photos of the deficiencies while we are doing the inspection, so they have a pretty good idea of what is coming. I almost always find something later that I overlooked during the move-out inspection, especially when cleaning - another reason I try to clean as soon as tenant moves out.

We have a Return of Possession form that both parties sign. In it, the tenant acknowledges they have moved out all of their belongings, have returned the keys and are ending their tenancy as of a specific date. It explains what we will do with any belongings we find left behind and references landlord-tenant law on the process for return of the security deposit.

We have a good track record for returning deposits because we nudge tenants to do what they need to do to get it back. In Washington State we have only 14 days to return the security deposit or provide a full explanation for the basis for which we retain any or all of the deposit. Its hard to meet that deadline when there are significant deficiencies to take care of, but we always do with at least one extra day to spare.

If the tenant does not want to do the move-out inspection with us, it is a red flag and usually points to damages that the tenant didn't want us to know about. If the tenancy ends because of a problem tenant, we rarely are able to get the tenant to do the move-out process in our customary way. That's okay, it just requires us to be extra diligent with our documentation.


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  • Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
    12y
    Eric,

    You can charge anything you want for labor, but if she takes you to court the judge will decide if you over charge on labor. The court will be in the area where the home is at and how much did the sink cost, and you might give her money back for the sink she installs. Don't send her a check have her to pick it up in person and sign a release. It will always cost more when you are and out of state landlord.

    Joe Gore

  • Investor · Dallas, TX · Member since 2009 · 718 posts · 913 votes
    12y

    Eric, usually this stuff is covered by state statute. I would figure out what the statute requires and follow that to the "T." Even though she technically breached the lease, you probably still have to follow certain procedures. Even here in TX, which is pretty landlord friendly, you've got to provide an itemization within 30 days or you can get tagged for treble damages.

    From a bigger standpoint, I've got to ask, what are you really upset about? 60 days vs. 30 days notice seems kind of minor to me on a month to month lease. Moreover, you can't charge her for normal wear and tear on the apartment, which there will certainly be after 1.5 years. I guess from a big picture karma point of view, I'm not sure you wouldn't be better off just working this out and returning most or all of the deposit.

    Also, your statement that "she breached the contract so legally I don't owe her a penny" is likely not correct. As a general matter, contract law awards you damages that you suffered as a result of her breach, but it's not automatic that she forfeits her security deposit.

  • Ned CareyPro Member
    Moderator
    Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
    12y

    Security deposits are often covered by state laws and some states like Maryland have very specific rules on how to handle them. In Maryland you need to give them a breakdown of what you are deducting for within a specific period. If you handle the security deposit wrong the tenant can claim triple damages.

    See if there is a local landlord tenant agency or state rules online.

  • Investor · Milton Florida · Member since 2010 · 51 posts · 12 votes
    12y

    Thanks guys,

    John, i'll look into the statutes. I guess i'm upset that it cost me so much, mainly because of the lack of notice I got. I understand the normal wear and tear, there was quite a bit of damages, I had to buy a new exterior door, sink faucet, interior door, towel racks, holes in the walls to name a few.


    I want to be real fair with her, but I guess I was just worried I would send her this check and then get taken to court and it cost me a lot of money.

    This is how a portion of the lease is worded:

    Tenant agrees to give the Landlord at least 60 days written notice before vacating the premises. If Tenant vacates without giving 60 days notice, Tenant will be liable for, but not limited to; (1) the balance of the rent for month in which they vacated the premises (2) all outstanding rents due. Tenant further acknowledges that all claims to the security deposit paid to landlord will be forfeited if proper notice to landlord is not provided.

  • Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
    12y

    I have a question to all landlords. When a tenant informed you in writing they are moving how do you handle the process from the time you receive the notice until they are out of the unit.

    Joe Gore

  • Investor · Appleton, WI · Member since 2012 · 1k+ posts · 464 votes
    12y

    joe - I will inform the tenant of what the process will be like. If they text me that they plan to move I will let them know what the lease says about notice and make sure that they deliever this in writing. So if they are late with notice I let them know right away. I let them know how I expect the place left. I also start talking about and then set up a walk through time and date for the final walkthrough. I aldo will explain to them the process for having prospective tenants coming through. I usually have something worked kut for notice and when I will be doing showings. I have only had 4 people leave in the 7 years I have been doing this although I have asked 3 others to leave. This has been over 10 units so I guess I don't have the most experience in this but I am glad not to have it :)

  • Real Estate Agent · Virginia Beach, VA · Member since 2012 · 2k+ posts · 1k+ votes
    12y

    It's my understanding (not a lawyer, so no legal advice) that you'd need to seriously document any personal labor you do to insure it's over and above normal wear and tear. I started just paying a cleaning company for the ones that were definitely over and above normal (after taking lots of photos.) Also, your lease should have some clause about them adding fixtures or changing/upgrading without your permission, so it may actually be her responsibility to pay to have the cabinet removed, not your responsibility to reimburse her for it, I would think, if she did it without your consent and you have it in your lease.

  • Investor · Delaware, OH · Member since 2013 · 224 posts · 64 votes
    12y

    @Account Closed -

    1. We call immediately and them that they need to take everything with them, clean the place, and keep utilities on until they are officially moved out.

    2. We post ads, and let the tenant know they will receive 24-hour notice of showings.

    3. We ask what needs to be fixed, and get in there and repair BEFORE they move out, when possible.

    4. We communicate at least once a week, to make sure things are moving along, and generally to find out if they are going to be out a few days early (they almost always are). We'll remind them of things that need done (hey, you have some garden tools you keep next to the house. They have to go. Don't forget the stuff in the basement.)

    5. We work out the plan for paying the final water bill.

    6. We schedule an inspection, perform the inspection, and get their new address.

    To-date, all our tenants have had their full security deposit returned - even for tenants who broke the lease and asked to move early, and those we asked to move early. Places have always been left clean, intact, and already rented. (Granted, I only have 4 units, so I guess I've been lucky so far that move outs have always gone so smoothly.)

  • Investor · Milton Florida · Member since 2010 · 51 posts · 12 votes
    12y

    Thanks Lynn,

    What about personal labor to say... replace the front door that the tenant demolished?

    Seems almost better to just bring in companies to do all the work...

  • Investor · Milton Florida · Member since 2010 · 51 posts · 12 votes
    12y

    I came across this:

    Some lease agreements contain clauses that allow the landlord to retain all or part of a security deposit upon the breach of the lease. This is known as a liquidated damages clause. If you are a landlord, this might be a nice thing to have in your next lease. However, you have to be careful in drafting such a clause. Courts make a distinction between permissible liquidated damages clauses, and impermissible penalties imposed on tenants to to force their compliance. It’s a delicate balance.

  • Investor · Vancouver, WA · Member since 2013 · 3k+ posts · 4k+ votes
    12y

    Joe, that sounds like a new topic. A good one too. If you post it as a new topic, I will reply.

  • Investor · Milton Florida · Member since 2010 · 51 posts · 12 votes
    12y

    Well, thanks all..

    I'm going to return half of her lasts months rent and not charge her labor for the repairs, only for materials which should be more than fair.

    Happy Holidays

  • Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
    12y
    Eric,

    I know you don't want to return the deposit but let's say she does not agree to it or want sign a release or cash the check, and her words see you in court.



    Joe Gore

  • Investor · Middletown, NJ · Member since 2008 · 2k+ posts · 1k+ votes
    12y

    Whatever is in your lease, make sure it has at least been reviewed by an attorney in your state specializing in landlord/tenant law..not divorces, adoptions, or DUI's. And don't try to save money by using a generic lease you found online or at Staples. Spend the money to have a legally correct, up to date lease that explains exactly what happens and when it happens. An attorney may be defending that lease in court, so make sure you're using one that is defendable...defensible..? :)

  • Sheboygan, WI · Member since 2013 · 107 posts · 18 votes
    12y

    @Eric D. Is the amount you want to keep worth the hassle of flying in and hiring an attorney? I have similar situations in my other business all the time. I act as nicely as possible and offer concessions to make it easier and avoid wasting my time with court.

  • Jose RubioPro Member
    Investor · Groveland, FL · Member since 2013 · 38 posts · 6 votes
    12y

    @Eric D. . You are NOT required to fully return the tenant's security deposit if there were damages to the property. Don't be intimidated by tenant threats, if you are in this business , they will always be part of it. I would not discuss or bring up breach of contract . But I would document ( pictures, receipts, detailed statement ) showing damages and all cost associated with getting property up to rentable condition. Promptly provide the tenant a breakdown of charges and if any issue the refund check.

  • Hanford, CA · Member since 2013 · 5k+ posts · 1k+ votes
    12y

    @Eric D.

    My lease allows me to charge the difference in lack of notice at the end of a tenancy. I also charge the tenant for ALL damage. The two times both myself and my mother were nice, my mom was taken to court and I was royally SC***wed. When we are professional, but stern and follow the letter of the lease we have gotten grudging respect. Everyone understand following the rules, they just like to push it as far as you let them :)

    I have found that I can only charge out of a security deposit what I pay someone else. Therefore I hire contractors to do perform all the work for the damages. I than have receipts for ALL the work. Honestly I wouldn't worry about what the tenant thinks or the judge as long as you FOLLOW YOUR LEASE and provide pictures/ receipts of the issues!!! I provide an itemized move out slip of illustrating why the money was taken out of the security deposit.

  • Investor · Milton Florida · Member since 2010 · 51 posts · 12 votes
    12y

    Thanks again everyone,

    @Jose Rubio I haven't mentioned the breach of lease to her, I guess i'll make her aware if she decides to press legal action.

    @Elizabeth C. Very good advice, thanks

    This all started when I was trying to get a forwarding address, Even though I had a letter written up I engaged in conversation about it, bad idea.

    What I learned from this:

    1. Long distance land-lording is difficult and expensive (property is now with a local management company, my other rental has a long term tenant)

    2. Hire companies to do all the work besides normal cleanup.

    3. When a tenant makes you aware they are moving out, get a forwarding address as soon as possible, be proactive in inspecting and fixing damages while tenant is still in place.

    4. Discussion of security deposit should be left to certified mail professional letter with an itemized list of damages(if there is any)

  • Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
    12y
    Eric,

    Why don't you just meet the tenant in person and give the check and get them to sign a release unless you are trying to hold of paying for 30 days?

    Joe Gore
  • Investor · Milton Florida · Member since 2010 · 51 posts · 12 votes
    12y

    @Account Closed I'm 2000 miles away :-) or I would.

    Thanks Joe. Have a good week.

  • Bill S.Pro Member
    Moderator
    Rental Property Investor · Denver, CO · Member since 2013 · 4k+ posts · 2k+ votes
    12y

    @Eric D. ok so why are you "fair" to the tenant but not yourself. What about being "fair" to your family and kids. Follow the lease. If the tenant caused damages then you need to charge them to fix them. Call up a local day labor supply company and ask them what their rate is. Charge that for your labor. Another option would be to ask your current PM what they recommend you charge for your labor or call a local eviction attorney and see what they recommend. Send her a complete accounting for damages and rent not paid, according lease. Follow your state requirement for security deposit return.

    Forget the whole forfeit your security deposit for lack of proper notice. This mixes up too many things. Using SD (which is tenant's money that you control) for liquidated damages without their written approval is not recommended.

    Ok so a few procedural questions/comments

    Why convert your year lease to month to month after one year. Why not convert to another year lease? Much better for your situation. MTM often means vacancies when you don't want them (December).

    Separate the whole security deposit from your liquidated damages. Your liquidated damages should be a specific dollar amount not equal to rent or the security deposit. I call it an early termination fee. Just like what cell phone companies use when you want to break their service contract.

    Lots of tenants threaten to sue because people are afraid to face court and they know it. Rarely do tenants sue. Good documentation, often turns away lawsuits as it shows them what they would face in court. Even if they sue you can still settle out of court. Being sued is not the end of the world.

    One added note. If you did rerent the place before the time that her 60 day notice would have been effective then you can not deduct those days from the security deposit (it's double dipping rent).

    Hope you got a good PM. Usually much easier said than done.

  • Colleen F.Pro Member
    Investor · Narragansett, RI · Member since 2013 · 8k+ posts · 4k+ votes
    12y

    You really need to check state law , here we cannot charge for labor. Other then that list all the items that were damaged and the corresponding charges for repair and return that list to the tenant with any remaining deposit minus deductions.

    For the bathroom vanity I don't know what your agreement was but if she put it in without permission that is not your problem. If she put it in with permission then you need to look at what you agreed to at the time. If you were unclear I would go in her favor on this one.

    People are never going to be happy if they think they should get the whole deposit back and they don't. However if you treat them fairly well it goes a long way.

  • Real estate investor · Las Vegas · Member since 2013 · 798 posts · 171 votes
    12y

    Check state laws (should be a guide to your lease). Itemize the exact damage. We always use a middle number estimate for repairs. Court is not the end of the world. Have been a couple of times, never any issues. The times I have seen people have trouble in court is lack of documentation or ignorance of state laws. @Joe Gore, if we have tenant that wants to leave early we usually work out something beneficial to both parties and some cases just have them leave. If a tenant wants out of a lease, they will find a way. It just seems easier and cheaper in the long run.

  • Dallas, TX · Member since 2013 · 4k+ posts · 744 votes
    12y
    Pete,

    If the tenant tells you, they are breaking the lease tell them if they leave the place like they found it, you would be there to give them their full deposit back in person once everything is out of the unit. I think that is a lot better than them wrecking the unit and costing you more.



    Joe Gore
  • Michele FischerPro Member
    Rental Property Investor · Seattle, WA · Member since 2013 · 2k+ posts · 1k+ votes
    12y

    Eric, I charge $18/hour for my and my husbands time to repair or clean. When we hire out sometimes it is more, sometimes less, but feel I could defend that to a judge. When I complete the move out letter, I add to the comments section the things I could have charged them for but chose not to. May or may not help them feel less "screwed", and gives more documentation to a judge that we were being reasonable. Sometimes we are still spending money to fix by the time we are legally required to get the letter out (2 weeks in my state), so we stop tallying and mail it. Our tenants either get almost full refunds or sent to collections after skipping, not much in between.

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