The Dos and Don’ts of Security Deposits
Security deposits – specifically, the proper handling of them – frequently present landlords with tricky situations. Unfortunately, many landlords wait to consult an eviction attorney until well after they have attempted to handle a thorny security deposit issue on their own.
Under California law, residential landlords can use a tenant’s security deposit in four situations:
- To cover a tenant’s unpaid rent
- To clean a rental after a tenant has vacated
- To repair damage, caused by the tenant, that goes beyond normal wear and tear
- To replace or restore personal property (such as furniture) that remains in the unit (if the lease contains a provision stating this is permissible)
Don’t Forget – Always Serve Notice of Right to Preliminary Inspection
Under California Civil Code Section 1950.5, a landlord must provide a tenant with written option to have the landlord conduct a pre-move out inspection of the rental unit upon either party’s decision to terminate the tenancy. If the landlord fails to properly notify a tenant of this right or fails to conduct this inspection upon the tenant’s request, the tenant can argue that he or she had no opportunity to fix any defects or damage. This obligation is in addition to the post-move out inspection and accounting requirements.
In practice, it’s always a good idea for landlords to take photos of any damage or condition noted during the inspection. Because most people have smartphones equipped with powerful, high-resolution cameras, it’s very easy to take high-quality photos of any damage that exceeds normal wear and tear. This documentation can be invaluable if the tenant contests any damage.
Once the preliminary inspection is complete, the landlord must give the tenant a written summary of all the problem areas that need to be fixed prior to the tenant moving out, along with a copy of C.C. section 1950.5. This gives the tenant an opportunity to “cure” any damage. If you do not want the tenant making a particular repair (for fear of falling off a ladder, for example), do not list the repair item or deduct for it.
Do Refund or Repair: After the Tenant Moves Out
Once the tenant moves out, the landlord has 21 days to either refund the tenant’s security deposit or send the tenant an itemized receipt detailing how the security deposit has been spent to cover repairs and restoration of the rental. Assuming the landlord did not require the full security deposit to cover the repairs, the landlord must provide both an itemized receipt as well as any funds left over from the security deposit. Landlords should carefully review the statute or consult legal counsel if unfamiliar with the detailed requirements for itemizing deductions from deposits.
California Real Estate and Eviction Law Attorneys
Attorney Kirkman J. Hoffman has more than 20 years’ experience representing commercial and residential landlords, owners, and property managers in Silicon Valley and the surrounding regions. Contact the team at Hoffman Law Group today at (408) 241-9620 to discuss your real estate or eviction matter.
This website has been prepared by Hoffman Law Group, APC for informational purposes only and does not, and is not intended to, constitute legal advice. The information is not provided in the course of an attorney-client relationship and is not intended to substitute for legal advice from an attorney licensed in your jurisdiction.