Security deposit returns should not be difficult; you’ve been holding the tenant’s money throughout the course of the lease, and when the tenancy has ended, you return the money minus any charges.
However, disputes can quickly arise, especially if your tenants disagree with the money you’re withholding to pay for damage or cleaning.
It’s important to follow California’s security deposit law carefully. Make sure you understand what’s required and how it applies to you.
Pre Move-Out Inspection
In California, landlords are required to offer their tenants a pre move-out inspection. Not all tenants will accept the offer, but you have to be willing to do it. During this inspection, you’ll walk through the Lamorinda rental property with your tenants while they are still in place. You’ll point out anything that needs to be repaired or replaced in order to avoid a charge to the security deposit. This gives the tenant time to take care of anything and gives you a preview for what you can expect to find after your tenants move out. It lets you know how long it may take to turn the property over before the next tenant moves in. This inspection must be scheduled with the tenants no more than two weeks before the move-out date.
Keeping and Returning the Deposit
Remember that you are not permitted to charge the deposit for normal wear and tear. Those tiny nail holes in the walls from where pictures were hung or scuffs in the carpet from where furniture was placed all qualify as normal wear and tear. There are a handful of things for which you can charge the deposit:
- Overdue or unpaid rent. If you never received the last month’s rental payment or only half a month was paid, you can keep the security deposit to cover the defaulted rental amount.
- Property damage that goes beyond normal wear and tear and is due to abuse, misuse, or neglect.
- Cleaning charges. Most lease agreements will require tenants to clean the property before vacating. If they don’t clean and you have to clean it yourself, you can charge the deposit.
- Any lease violations. If your tenant did not pay utility or HOA bills as required by the lease agreement, you can use the security deposit to pay for those things.
California Security Deposit Timelines
After your Lamorinda tenant moves out, you will have 21 days to return the security deposit. With the amount you’re returning, you’ll need to include an itemized statement. That statement must include information that reflects how much was collected at the beginning of the lease and how much is being returned. You have to document every deduction that you’ve made. Include receipts and invoices for the work that was performed and if you haven’t paid for that work yet, you can include good faith estimates.
If there’s a dispute, you’ll need to support your deductions in court. This can be a challenge, so make sure you have detailed and clear inspection reports and photos. Be willing to work with the tenant. If your tenant is fighting back against a $75 charge to their deposit, you might want to let it go. In court, you could lose and be required to pay the tenants three times that amount.
We’d be happy to help you with your security deposit process. Please contact us at Stowers Real Estate if you have any questions or need any help.