Security Deposit -------------

16 Replies

So I have a property in Cape Coral Fl, single family. I have a tenant that been living in the property going on 2 years. Property manager over see everything out there. Now the tenant currently wants to break the lease early by 1 month. (The Property is well maintained no damaged) Should they get the security deposit back? My property manager suggest they do.

I'd just give the funds back to them. If the property is in good shape and you want to keep it that way, thats what I would recommend. 

It depends on the results of your move out inspection. Legally the deposit is to pay for tenant caused damage otherwise it belongs to the tenant and must be returned.

Time for you to sit down and learn your state landlord tenant regulations. It is your responsibility to know the law if you intend to operate a business. You should have learned the law before you started operating your business.

Jose,

If the property is left in make ready Condition, I would give them the money back

The security deposit legally protects against damage to the property and NOT a breaking of the lease. If there is no damage, give them the money or else you could likely be sued. 

Now... if you want, you can sue them for the remaining rent due if they are on an annual lease.

Or, just let 'em go and put a new tenant in there at current market rates. 

If you can rent it for the month they are moving out fine,, otherwise do a break lease fee equal to one month rent.

Security deposit is processed after move out. Has nothing to do with Rent or lease break Fee.

Get a PM that will protect your asset.. they get their fee's and won't adjust them ...Will they>>

Learn your state landlord tenant laws so you what you can and can't do for lease break fees and review your written lease so it clearly states penalties or put in a policy packet document addendum

If you can rent it for the month they are moving out fine,, otherwise do a break lease fee equal to one month rent.

Security deposit is processed after move out. Has nothing to do with Rent or lease break Fee.

Get a PM that will protect your asset.. they get their fee's and won't adjust them ...Will they>>

Learn your state landlord tenant laws so you what you can and can't do for lease break fees and review your written lease so it clearly states penalties or put in a policy packet document addendum

@Jose Lopez depends if there is anything to repair related to their tenancy. If there is then use the fund to repair that. That's what the deposit is for. 

If they move out early then charge them what your lease says for breaking the lease early. Tell them that you will immediately market the unit and if you have a tenant ready to move in then you won't charge them, but that if you have a vacancy as a result you will charge them a prorated amount for the amount of days remaining in their lease. 

I don't think someone will tear up the unit just because you tell them you need to market the unit before they move out and will only charge them for the amount of time that they would have otherwise paid. Risk is low there in my opinion. 

Return of the security deposit is contingent on the condition of the unit once vacated. Normally, they'd be entitled to the return of their deposit. Where a tenant is breaking their lease they open themselves to you using their deposit to make yourself whole. If you'll have no problems re-renting and they vacate in good shape I'd return the deposit. You can also negotiate retention of some portion of the deposit in satisfaction of the broken lease. However, if you rent the place right away you'd technically have no harm as a result of the broke. Lease and therefore wouldn't be entitled to any of the deposit as a result of the lease having been broken.

Thanks for the feed backs, guys and Ladies. I have thought it through and will be giving them back the security deposit. The property was is left in great condition. These are my first tenants/property. Obviously still on a learning curve. Few thing I have read from the feed back that I will take into much concideration is learning Florida state landlord tenant laws. Again thanks you.

You possibly get higher rent or even better tenants.

See.Florida chapter 83 part 2 for your own education. I have now added a termination fee and all of my leases which helps protect against vacancy losses. Are you getting Market rent. In my opinion the market is flattening. If you're a tenant is going to leave early the best thing your manager can do is get it advertised immediately.

@Sam Shueh higher rent is what I'm aiming for the next tenants . @John Thedford yes early termination fee will be added to the new lease agreement for new tenants (was thinking half the rent if rent is $1,550/$775 or $1,600/$800.) The highest rent I had with the tenant that is moving out was $1,550, for next tenant we are shooting for $1,600. 

You might want to read this on Florida's early termination liquidated damages clause for your new lease.  http://www.nolo.com/sites/default/files/FL_EarlyTermination_LiquidatedDamagesLeaseAdden.pdf

@Jose Lopez

I am now asking for roughly 1.5 x the monthly rent for a termination fee. I know some PM that charge two months.

@Jose Lopez

I ask 1.5x the monthly rent and many others ask for 2x the monthly rent for an early termination fee.

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