Renter broke lease. Not giving back deposit of pne month?
I have new renter who broke lease after 9 months. Originally I rent for 1500 month. I have told previous renters I would lower rent if signed 2 year lease. In this case 1400 month. This renter gave me 1500 deposit. and signed 2 years lease and broke lease after 9 months stating cannot afford any more and does not want to be in with roommates any more. So I am already out 900 dollars that I would have got for 1 year lease.
I have decided to put the house up for sale after much thought and hence won't be doing diligent looking for replacement renters. I am on good terms other than rental lease being broken. House has normal wear and tear. I am planning on keeping 1400 and giving back 100 for dog deposit. Am I in legal rights to do this? I am in Colorado and from all I have read I am in the right here.
Always depends on the lease - but as long as you send the letter to the tenant accounting for why you are keeping the money within 30/60 days - again depending on your lease. Obviously not worth trying to collect any unpaid rent for the lease term if you are going to sell the property. At this point it is much more important to get the property back in good shape than to try to get the money from the tenant.
I agree with @Travis Sperr it is imperative you provide the tenant with a document accounting for the use of said security deposit. Review your lease, it is likely clearly outlined in the Security Deposit clause that it can be applied towards unpaid rent of the lease term. If you do have that clause I would recommend showing it to the tenant so everyone is on the same page. Best of luck.
@Dallas Knoll ok so you can probably get away with this but it's not legal. Apart from specific language in the lease addressing this issue you can not "keep" the security deposit for a broken lease. Legally, you can use the security deposit to offset lost rent while you attempt to re-rent the property but since you aren't trying to re-rent you can't do that either.
My advise would be to have the departing tenant sign a lease termination agreement. This agreement would give you funds (the amount of the SD) to cover your unknown liability of re-renting. The leverage you use is that if they fail to execute this agreement then you can sue them in small claims court for lost rent and utility costs while you are attempting to re-rent the property (You have to make an honest attempt at re-renting-it would be a grey area to offer it for rent and for sale at the same time). Most tenants will sign away the SD in exchange for reduced future liability. The down side of this approach is that they now have no incentive to clean or move out carefully.
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Real Estate Agent Colorado (#IR044146)
- Reliant Real Estate, Inc.
Thanks, from all I have read I think I am ok. I am not going to pursue the rest of the money from broken lease. I live very close to rental and in good shape since I remodeled it 8
Originally posted by @Dallas Knoll:
I have new renter who broke lease after 9 months. Originally I rent for 1500 month. I have told previous renters I would lower rent if signed 2 year lease. In this case 1400 month. This renter gave me 1500 deposit. and signed 2 years lease and broke lease after 9 months stating cannot afford any more and does not want to be in with roommates any more. So I am already out 900 dollars that I would have got for 1 year lease.
I have decided to put the house up for sale after much thought and hence won't be doing diligent looking for replacement renters. I am on good terms other than rental lease being broken. House has normal wear and tear. I am planning on keeping 1400 and giving back 100 for dog deposit. Am I in legal rights to do this? I am in Colorado and from all I have read I am in the right here.
No, probably not.
In FL at least, you can only keep the deposit for the length of time that the property is unrented.
However, you've clearly stated that you intend to sell the house (on a public forum no less), so there is no downtime between leases. The first lease has been broken and you intend to sell the house.
Therefore, you have no reason to keep the deposit to compensate you for loss of income.
Thanks, from all I have read I think I am ok. I am not going to pursue the rest of the money from broken lease. I live very close to rental and in good shape since I remodeled it in 2008.
Although I am pursuing sale of home through 1031 exchange if I can't find better investment I will continue to rent till better time. I have also shown other people house and have had offers to rent and one for a purchase so kind of grey area. What about the 9 months I could have got at 1500? And if I do rent it out then what. I guess that is why I posed the question in the first place. I appreciate all your replies. I have states in my lease I have up to 60 days to return deposit. So I hope to have this settled soon.