Thoughts on First, Last and Security Deposit - Landlord Forum thread 344589

Thoughts on First, Last and Security Deposit by ASRIMS (FL) on April 22, 2016 @14:35

Hello Friends! I'd like to find out what everyone's thoughts are on first, last and security deposit. Up to now, we've always charged security deposit and first month's rent. However, we've been burned by some lousy tenants who "bag" on the last month's rent and say "use the security deposit," despite the lease specifically prohibiting this. Leaves us totally unprotected for any damage they may have done. My husband now wants to charge first, last and security, which seems like a lot for someone to get into a place. The particular house we will be leasing in June is $1,400 a month. If we go that route and charge $1,400 for security, that means the person will pay $4,200 to get into the house. What are your thoughts?

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You are the one with the investment by Kathleen on April 22, 2016 @14:43	[ Reply ]

Check around with local property management---are you in line with their charges? Renters know the market and how much it costs to move at every price point.

Re: Thoughts on First, Last and Security Deposit by Garry (Iowa) on April 22, 2016 @15:18	[ Reply ]

You need to look up the LL/T laws for Florida, and see what they say on the subject. Most all the states have something in those laws about how much you can charge for a deposit, and if you can also ask for the last's month rent up front. However, as you point out, WANTING to collect lasts months rent up front, and actually GETTING it, are 2 different things. Getting it is mostly market-driven. If most of the rentals for miles around you are not asking for it and getting it, you won't be able to collect it, either, unless your rental market is extremely tight in favor of the LL. Pretty much all Ts expect to have to pay a deposit equal to 1 months rent, all over the country. But once you ask for a double deposit, those Ts, even the good ones, will look elsewhere to find a more accommodating LL. If anyone should ask you to use their deposit for last months rent , simply tell them NO, that you expect them to pay you the rent for the last month, and you will start eviction procedures on them if you don't get it.

Re: Thoughts on First, Last and Security Deposit by tenant advocate on April 22, 2016 @15:34	[ Reply ]

As suggested look into the specific laws of your state. But here is another idea if you decide to go ahead with the last month being required too: Allow the last month's payment to be split up in payments. How much to split it up is up to you. 3 months to six months is generally a good bet. The earlier it is the safer it is for you but the bigger the burden on the tenant. Also keep in mind if you are holding $3,000 of the tenant's money and you do anything legally iffy the tenant is far more likely to go after you in court (or in some other way in revenge) over that amount. For a tenant that is a lot of money.

Re: Thoughts on First, Last and Security Deposit by Magic Mike on April 22, 2016 @17:57	[ Reply ]

You can do it, nothing illegal about it. I know a LL in a hot market that actually requires the entire 12 months paid in advance - and gets it. If your market does not support first/last/dep, then I would highly recommend you increase your application standards. Increase the income requirements, the credit scores, etc. Ask for 5 references. Proof of employment. Etc. That goes a long way in getting a good tenant.

Re: Thoughts on First, Last and Security Deposit

Re: Thoughts on First, Last and Security Deposit by MrDan (GA) on April 23, 2016 @17:17	[ Reply ]

Collecting first month's rent, last month's rent and a security deposit is something from the old days of property management. The only thing achieved by collecting last month’s rent is you bind yourself and restrict what you can do, and it doesn’t really get you anything. It's better to collect a larger deposit that can be applied to any potential damages rather than last months rent. To the tenant, it doesn’t matter, they’re still paying the same dollar amount up front either way. The other side is if you require such a large deposit up front, you are restricting your pool of tenants. Either way, the problem really lies in the way you are screening your applicants. A bad or lousy tenant should never make it pass your screening requirements.