If a tenant asks you to use their security deposit as their last month’s rent, assuming you live in a jurisdiction where that is legal, before you say yes, it is in your best interest to inspect the rental unit to ensure that you will not need to use the security deposit funds for repairs. And if a client fails to pay rent or agreed-upon utility charges, you may deduct for those items as well. In the event of a future dispute, it is ideal to have kept receipts for cleaning, repairs, and other services that led to security deposit deductions. Even if you feel you would be justified in taking out more money, it is often not worth the additional disagreements and potential legal processes that may ensue. It is usually best to be conservative in terms of the amounts you withhold, and not to charge for replacements when a repair will be sufficient. In general you are trying to take out only as much money as you need to get the unit back to the condition it was in before the tenant moved in. When landlords deduct funds from security deposits, these deductions tend to be highly disputed, so it is important to bear in mind that you will want to have solid reasons for any of the withholdings you plan to make.

This is important to do even if you are returning all of the money, along with any interest required under applicable law. When you return the security deposit to the tenant, which must be done by mail in some states, be sure to include an itemized statement, which is also required in some states, detailing any deductions you are making.

Typically you have somewhere between 14 and 30 days to return the security deposit, though it is often best to be as prompt as possible. Landlords generally have 14 to 30 days to return a security deposit after move-out. The longer a tenant has been there, the more wear and tear there will be for shorter term tenants who do more specific damage it may be easier to make security deposit deductions. For example, while you usually can deduct from the security deposit for actual damage to the unit, you cannot usually take money out for ordinary wear and tear.

The rules for returning security deposits can vary by state, but a few general principles apply in most places. You can also take photographs at this time to add to the photographs you may have taken before the tenant moved in so as to have a record of the before-and-after condition of the property. You will also want to complete a move-out checklist with the tenant (which is required in some states), and ideally do a walk-through of the unit with them so that you can review and discuss any potential damage together. This helps to clearly communicate your expectations to the tenant ahead of time, and also gives them the opportunity to ask questions or alert you to any potential problems. This helps to eliminate confusion and miscommunications by setting clear expectations, and also helps to protect you in the event of a legal dispute.Ī good way to begin the move-out process is to send a move-out letter to your tenant detailing what the process will be going forward in terms of cleaning and preparing the unit for move-out, as well as what the procedures will be relative to the tenant’s security deposit. One of the best ways that you can prepare for any situation that arises at the end of a tenancy is to have a detailed and consistent process that you follow with all tenants when they are preparing to move out. Some of these rules will apply in most situations involving the end of a tenancy, whereas others will only come into play in the event of a disagreement. When it’s time for a tenant to move out, there are several requirements that you will need to fulfill as a landlord.

Commercial tenant move out checklist