California has a pretty strict set of rules and laws when it comes to security deposits. Make sure you understand the timelines and the requirements when your Oakland tenant is moving out and you’re preparing to return the security deposit.
We have some tips for you today on how to avoid security deposit disputes with your tenants.
You’re legally required to offer your tenants a pre move-out inspection of the Oakland rental property before the end of their lease term. Not every tenant will accept this invitation, but you need to make the offer.
This is an opportunity for you to walk through the property with your tenant and point out things that might result in a charge against their security deposit. It lets you know what you’ll have to be prepared to repair before you rent the home out to a new tenant, and it lets your current tenant know that they either have to take care of these things themselves or prepare to lose money from their deposit to pay for them.
After your tenants have turned in the keys and left a forwarding address, you’ll need to go through the vacant property and document its condition. Bring your move-in inspection report with you so you can compare the condition of the home at this point to the condition it was in when the tenants took possession. Hopefully you created a well-documented record of how everything looked then.
Remember that you’re not permitted to deduct anything from the security deposit for regular wear and tear. Those small nail holes in the walls and scuff marks from where the sofa rested cannot be charged to the tenant. Landlords are responsible for wear and tear items.
However, if your lease states that the property must be professionally cleaned before the tenants move out and it clearly has not been cleaned, you can charge for that. Make sure you take pictures to document that it was not cleaned. If you notice damages that are beyond normal wear and tear, you can charge for that. Make sure you can demonstrate that those things were not broken or damaged at the beginning of the lease.
You can also charge the security deposit for any unpaid rent, so if you’re going to do that, make sure you have the accounting reports and rent statements to prove that money is owed.
California law requires you to return the security deposit to the tenants within 21 days of the tenant moving out. If the tenant isn’t receiving a full deposit refund, you should send the amount that they are getting back with an itemized list of what you’ve deducted and why. Be specific and include receipts, invoices, and other documentation to support what you’ve charged.
If your tenant disputes what you’ve withheld or you don’t return the deposit in time, you could face penalties of three times the amount of the original security deposit. It’s important that you know what’s expected of you, and that you follow the law.
We can assist with any security deposit questions you have. If you’d like some help with your Oakland rental property, please contact us at Prime Property Group, Inc.