How to take the fear out of Renting Your Property in Orlando Part 15 "The Security Deposit Settlement Statement Process"
Once you’re back in your home office, you’ll want to pull out your move in documentation and compare it to the move out. (You may want to invest in Inspection Software which will make this process easier since you will have a standard template for the move in and move out which make comparisons much easier to assess and defend.)
Be mindful to ensure that you have proof of any claims you may be assessing on your vacated tenant’s security deposit. Security deposit disputes are very common, and you will need to back up your claims to your former tenant and potentially to a judge.
Remember, there is a common accepted principle that you should not assess charges that are beyond normal wear and tear. The problem here is that there is no specific ‘rule book’ to turn to, to determine exactly what the universal definition of ‘normal wear and tear’ is. It is usually very subjective, and therefore varies from person to person and their opinion.
The key is to be fair. You need to consider how long your tenants lived in the home and consider whether or not it is simply ‘time’ to replace carpets or complete a full repaint of the interior. If so, don’t charge your tenants for carpet cleaning or touch up painting. Charge for true ‘damage’ and nothing further. The more you err on the side of caution when considering what ‘normal wear and tear’ is, the chances that you’ll have to argue your position with your former tenant or even a judge, will be greatly reduced.
Once you’ve assessed any charges, make sure that you follow your state’s laws regarding how much time you have to send your former tenant their final settlement statement and exactly how it must be served to them (i.e., certified mail required). Chances are there are different compliance issues with a statement that you are assessing charges on, and one where you’re fully refunding your former tenant’s deposit.
The last step is usually one of the trickiest; refrain from making claims that are unnecessary or unwarranted. And remember, you can always contact us for your Professional Property Management needs; we’re here to represent you and protect you from the pitfalls of managing one of your largest investments.