Tenant demands I return security deposit to their Bank account

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Tenant demands I return security deposit to their Bank account

Nate Palmer
Member since 2018 · 3 posts · 0 votes

My tenant moved out and won't provide a forwarding address as they say they left the country. They are requesting that I go to their bank and give their bank the security deposit to the account number they have provided. 

My understanding is that I am required by law to return the security deposit by person or by mail to their forwarding address. I am concerned that there is something unusual going on, that I will deposit the funds and then they claim that they never received them or something odd like that. Something just doesn't feel right about the situation.

What would you do?

Nate

(Property is in NJ)

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Nathan GesnerBusiness Member
Moderator
Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
8y

New Jersey statutes 46:8-21.1 Return of deposit; displaced tenant; termination of lease; civil penalties, certain. Within 30 days after the termination of the tenant's lease or licensee's agreement, the owner or lessee shall return by personal delivery, registered or certified mail...

I would tell the tenant, in writing, that you will return it in accordance with NJ law once they provide a forwarding address. Then hold it and wait.

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  • Michael Randle
    Aurora, CO · Member since 2016 · 158 posts · 118 votes
    8y

    Not that it might matter, but how did the tenant pay you every month?

    Regardless unless they have joined a wandering caravan that is going through the Gobi desert I believe mail gets delivered almost anywhere. So if the law states it has to be mailed...mail it. Not your problem it is going to take a week or two to get to them.

    I would rather an out of country ex-tenant be mad his last check took two weeks to get to him then the FBI come knocking on my door because I unwittingly deposited a check into a terrorist money laundering slush fund.

    Plus I do not think you can even walk into a bank and try and put money into someone else's account anymore unless you are on the account or you have a deposit slip etc.

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  • Nate Palmer
    OP
    Member since 2018 · 3 posts · 0 votes
    8y

    The tenant did pay regularly without any major issues. They did have a “check is lost in the mail” one month and from then on they wanted to pay by directly depositing into my checking account at a local branch. So I think their lost check issues was a legitimate one. 

    So in their mind, they may be thinking their request is totally reasonable since that’s how they paid me. I’m 75% sure that it’s not a scam, but don’t want to risk that 25% chance it is!

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  • Andreas W.
    Durham, NC · Member since 2013 · 502 posts · 215 votes
    8y
    Have them sign an agreement stating where the deposit goes, incl. bank name and account number. no funds get moved before signed agreement is received by you.
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  • Wayne Brooks
    Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    8y

    I would think as long as they request it in writing/email, properly worded as to they wish for it Not be mailed, you’d be sufficiently covered....and you providing any required accounting, etc. by email.

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  • Jennifer T.Pro Member
    Investor · New Orleans, LA · Member since 2014 · 1k+ posts · 944 votes
    8y

    I would inform the tenant that you aren't doing that.  Either he can give you a forwarding address for the SD to be mailed to or you will send it to the last known address you have for him, ie the unit he was renting.  Make sure to send it certified, return receipt.

    However, if he did not give the post office a forwarding address either, it will end up coming back to you.  Which is just too bad, so sad for him.  Keep the letter/check, don't open it.  I'd assume he'll eventually let you know where he wants it mailed.

    Or, I would suggest to him that he can give you the name/address of a friend or relative and you'll send his check there (made payable to him, of course).  And then THEY can go deposit it in his bank.  But that isn't your responsibility to essentially run an errand for him, by making a special trip to his bank. 

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  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    8y

    New Jersey statutes 46:8-21.1 Return of deposit; displaced tenant; termination of lease; civil penalties, certain. Within 30 days after the termination of the tenant's lease or licensee's agreement, the owner or lessee shall return by personal delivery, registered or certified mail...

    I would tell the tenant, in writing, that you will return it in accordance with NJ law once they provide a forwarding address. Then hold it and wait.

    The DIY Landlord Book4.7247 Reviews
    WebsiteView Page
    4Reply
  • Nate Palmer
    OP
    Member since 2018 · 3 posts · 0 votes
    8y

    Just to follow up, I told the tenant that I'm only going to mail it to them and if they refuse to provide an address, that's their problem. They whined and whined but eventually gave me an address. Thanks to all for the help!

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