I received a full holding deposit on one of my homes I manage last week on March 11. Move in and Lease are set to begin on April 10. I used the Bigger Pockets "Deposit to Hold" receipt, which clearly states the deposit is Non Refundable. We have not signed the Lease as of yet since we are still 3 weeks from move in, but today the incoming tenant claiming with the Lock down in California, that he would not be able to move and is requesting his deposit back. We are planning to tell them there will be no refund on the deposit. I just want to make sure me and my client (owner) are covered? Maybe, give them an option of delaying their move in a couple more weeks?? Any additional thoughts?
Check your state law and city regarding refunding a holding deposit. Make sure this doesn’t violate a law. Clarify with them why they are cancelling the proposed lease. You can always sign a lease prior to move in. Hold keys until move in date. Based on the crisis we are going through if they changed there mind I would refund the deposit.
Rental Property Investor · Los Angeles, CA · Member since 2017 · 2k+ posts · 5k+ votes
6y
In CA, Holding Deposits are non-refundable. The amount you can keep will depend on your actual losses and only under the condition that you would have actually rented to the person (ex. they passed your minimum qualifications) and they did not back out due to the landlords failing or the units failings.
It sounds like the unit was off the market for 12 days and therefore you should be able to keep 12 days worth of rent. If you incurred additional costs of marketing the unit, these can also be deducted.
This is not a North Korean lockdown where if you go out you get shot or imprisoned. You are free to travel for many reasons including errands. The tenant can still move into a new place as clearly housing is essential. It might not be as convenient as they want, but they can still move.