Keeping My Inherited Tenants' Security Deposit: How To Notify Them?

Keeping My Inherited Tenants' Security Deposit: How To Notify Them?

Member since 2019 · 17 posts · 6 votes

Hello BP community!

I'm in PA and I closed on a duplex this past December (my first ever!) and am house-hacking with my wife. The tenants were originally planning to stay, but right before closing, they gave the seller their notice that they were leaving at then end of the month (12/31/23). I closed on 12/15, so at closing, I received prorated rent for the month, as well as their security deposit. They technically broke their lease because they didn't give 30 days notice. In their note to the seller they also acknowledged they paid rent late.

The previous owner had two strokes and wasn't in a position to provide me with much information with regards to whether he kept the deposit in an interest-bearing account. My realtor was insistent that we get that in writing from the seller, but they pushed back because the deposit was only $200 and they didn't expect the tenants to make a fuss. I still want to do things by the book if I can, but I'm wondering if it's worth the hassle.

My question is, how should I go about notifying them I am keeping the funds? My related question is, because they broke the lease, should I even bother? Or perhaps that makes it easier for me to keep the deposit? They lived in the unit for 5 years so there is significant cleaning to be done, painting, repairing holes in walls, replaced a broken microwave they'd taped together, fixed the shower, and many other things. The attorney I'd been working with is MIA (great sign I know.. will be looking for someone new), but I don't want to delay sending them a letter.

Do the more seasoned folks out there think I should just rack up $200 in standard supplies and send the note to them? Think it's not necessary to send a letter at all? 

Would love to hear your thoughts and ideas!

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  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    2y

    Send them a letter saying that the $200 deposit is being used to cover cleaning expenses and minor repairs.  Send photos of the empty unit and damage in the letter. Send the letter registered mail to their current address and if you don't know it, send it to the rental address.  If they haven't forwarded their mail, it will go back to you. Keep it unopened in case they contact you later and say you never sent it.

  • Nathan GesnerBusiness Member
    Moderator
    Real Estate Broker · Cody, WY · Member since 2010 · 28k+ posts · 41k+ votes
    2y

    Theresa is correct. Send them a letter showing an itemized list of charges that you used the deposit for. 

    It's $200. If you are nervous about this, just send the money back and be done. I personally wouldn't worry about a tenant filing in small claims to get $200 back. It will cost them more than that to file.

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  • Scott BridgehousePro Member
    OP
    Member since 2019 · 17 posts · 6 votes
    2y

    Great advice all around. Thank you both! It's really a solid point about how they'd be going through more trouble than its worth for it all.

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