Re: Holding Apartment Question - Landlord Forum thread

Re: Holding Apartment Question by Lisa on November 6, 2009 @00:06

Sorry, I mean't converting holding fee to SD?

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Re: Holding Apartment Question by OK-LL on November 6, 2009 @01:32	[ Reply ]
It's a bad idea to convert the HF to SD because if push comes to shove and you end up in court, a judge might say it was effectively an SD all along (if it barks like a dog...), and you're just trying to take advantage by giving it a different name. If you convert it to rent, there's no saying it was ever the intent that it be an SD.

Re: Holding Apartment Question by Lisa on November 6, 2009 @10:35	[ Reply ]
OK-LL, I get that part about it looking like a SD, but still don't understand why it is important it is not SD as opposed to rent? What are the ramifications? I always thought that a SD began by being a deposit to hold the apartment and then to secure the Applicants responsibilities to the subsequent Lease thereafter?

Re: Holding Apartment Question by OK-LL on November 6, 2009 @11:21

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If the final identity of a fund (HF) is SD, the judge may determine that it was initially a (refundable) SD and therefore not subject to being a non-refundable fee (remember, as we see every day, judges exercise broad discretion in small claims decisions). If the final disposition of a fund (HF) is (non-refundable) rent, then it is more likely a judge will determine that the fund was never intended to be refundable ever.

The difference is converting a non-refundable fee to a refundable SD; instead just convert the non-refundable fee to a non-refundable other use, like rent.

It'll probably rarely come up, because you've explained clearly to the prospect that the holding fee is non-refundable, but if it does, you'll have one more arrow in your arsenal to defeat the argument that the HF should be refunded.

Re: Holding Apartment Question by Lisa on November 6, 2009 @13:39

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Hi, Thank you. Great Information. I have been researching this term HF all morning and then going back to the LPA Application. It appears there should be many things edited in the LPA App to reflect this new information. Why does the LPA App not cover us in this way. It seems the more I learn the less I know. LOL! Now I see why I once had a Judge force me to return the entire SD while holding after all our losses.