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Who controls the tenant deposits

Money security concept

Who controls the tenant deposits when Leasing Texas manages the property?

When a tenant pays their security deposit, the deposit is placed in a Leasing Texas trust account. Once the security deposit accounting has been completed at move out, the deposit is either refunded to the tenant and/or distributed to the landlord, depending on the condition of the property and if there were any charges against the deposit at move out.

The security deposit accounting is performed within 30-days of the tenant surrendering the premises.

What Can the Landlord Deduct From the Security Deposit?

A landlord cannot legally deduct for normal wear and tear. This refers to deterioration, which occurs during regular, daily, intended use of the rental unit, for example nail holes in the walls from pictures or paintings. Damages caused by negligence, carelessness, accidents, or abuse of the premises by the tenant or the tenant’s guests are not normal wear and tear.

If the tenant moves out of a property leaving Kool-Aid stains on the carpet, a three-inch hole in the bathroom wall, and sacks of garbage in the garage (which were not there when the tenant moved in), these could be considered damages and the landlord is entitled to use all or part of the deposit to make these repairs.

However, if the tenant moves out of the property leaving it in the same condition as when the tenant moved in, except for normal wear and tear, and no money is owed the landlord, the tenant should get all of the deposit back.

Deductions From the Deposit

If the landlord makes any deductions from the deposit, a written, itemized accounting of how much is being charged for each item must be sent to the tenant. If the landlord fails to provide such an accounting within 30 days after the tenant moves out, the landlord may forfeit the right to withhold any part of the deposit. Furthermore, the deductions taken from the deposit must be for actual damages suffered by the landlord.

Can the Deposit Be Used in Place of the Last Month’s Rent?

The security deposit law also contains a protection for landlords. Normally, the tenant cannot deduct the security deposit from the last month’s rent without the landlord’s written permission. If the tenant withholds part of the rent and claims that the security deposit makes up the balance, that action will be in violation of the law. The landlord can sue the tenant for three times the amount wrongfully withheld plus court costs and reasonable attorney’s fees.

To find out what happens to the security deposit at lease termination, click here What happens to the deposit?

For a detailed explanation on the various deposits which may be required, click here  Various types of deposits  

Posted by: Leasing Texas on July 8, 2015
Posted in: Landlords, Tenants