Visalia landlords are required to collect, hold, and ultimately return a tenant’s security deposit. This can sometimes be tricky, especially if you don’t understand the security deposit laws or if you have a tenant who is disputing your claims of damage.
You’re holding the security deposit, but it remains the tenant’s money until the end of the lease term and you’re managing the disposition. You collect that money ahead of the residency and when they leave, you will either give the money back to them or return some portion of it, keeping the rest to cover the costs of damage, unpaid rent, and in some cases – cleaning.
There is a lot of room for error and miscommunication during the security deposit disposition, and we want to help you avoid that. Here’s what you need to know when it’s time to return your tenants’ money (or keep it).
Visalia Tenant Communication during the Move-Out Process
You don’t want to leave your tenants to figure all this out on their own. Here’s what we do at The Equity Group:
About two weeks prior to move-out, we invite the departing tenants to a pre-move out inspection. You’re required to offer this to your tenants, and while not everyone will take advantage of your offer, you should strongly recommend it.
Frame it as an opportunity to learn how to get their entire deposit back.
We inspect the property with the tenant and point out any of the things that might invite a deduction to that deposit. There might be holes in the walls that need patching or some extra cleaning that needs to be done.
This is an opportunity for the tenants to speak with us and increase the chances that they’ll get their security deposit back. It’s also a good opportunity for us because we can get an idea about what kind of work will be needed during the turnover process.
Inspecting Visalia Rental Homes after Tenants Vacate
Once the tenants have moved out of the property, you’ll need to go inside and conduct a full inspection of the empty home. Take photos so you can document any damage or potential charges to that security deposit.
This is where it’s critical to understand the difference between damage and wear and tear.
In California, security deposits can be charged for tenant damage, but any wear and tear issues are the responsibility of the landlord.
What does that mean?
It means that sometimes furniture will leave scuff marks on walls and floors. That’s not damage.
Wear and tear is the general deterioration that any property takes on during a residency. Small nail holes happen when pictures are hung. Carpet gets worn in high traffic areas. Damage, on the other hand, is caused by tenants intentionally or accidentally. It’s the result of abuse, misuse, or neglect. Large holes in the walls, cabinet doors dangling from their hinges, and huge tears or stains in carpet could be considered damage.
If you’re not sure how to separate the damage from the general wear and tear, reach out to a Visalia property manager.
Security Deposit Timing
You have 21 days from the tenant’s move-out to return the security deposit and/or a disposition letter.
Send any remaining security deposit that is owed to them and if you made deductions, make sure there’s an itemized list of what you withheld and why. You’ll need accounting that reflects the unpaid late fees you might have charged to the deposit as well as any damage that was fixed in the home.
If you’re not able to make all the necessary repairs within those 21 days, you have to send a Good Faith Statement with an estimate of what those repairs will cost. This isn’t generally necessary, especially if you have a good team of vendors who can make your repairs quickly.
Tenants like to claim that they left the property in better shape than it was when they moved in. Make sure you have the move-in and move-out inspection reports to disprove this.
Security Deposit Disputes
When a tenant pushes back against what you’ve charged, you need to think carefully about how willing you are to fight for what you’ve kept. Sometimes, we are wrong. We might bill for something that we shouldn’t have. In those cases, we accept responsibility and we make it right.
Sometimes, landlords will charge for things without providing a receipt or invoice. You might get away with it, but if your tenant calls you out on it, you’ll want to make the fix as quickly as possible or risk being taken to court.
We are just as eager as our tenants to refund the full security deposit. This is why we push so hard for that pre-move out inspection. It’s why we’re so detailed in our accounting. When we can return a tenant’s full security deposit, it means that property is in excellent condition and we can get it back on the market faster. Everybody wins.
Teaching your tenants how to get that deposit back will absolutely reduce the number of disputes you receive from tenants who are moving out. It will improve the chances that they get their money back and it will reduce the time and the expense of your turnover.
Don’t be a jerk.
You don’t want to ding your tenants for every extra thing you can find. You should absolutely hold your tenants accountable for the damage that they’ve left and not repaired. But if you start making questionable deductions, your tenants have the right to take you to small claims court. This is rarely a good outcome for landlords. If the court rules in the tenant’s favor, you have to return the entire deposit and you may have to pay up to three times the amount of that deposit in punitive damages. Don’t go to court unless you know you’re going to win.
This isn’t about what you’re owed or what your tenant is entitled to. It’s about following California’s strict security deposit laws.
We know security deposits in Visalia rental properties can be confusing, and we’re here to help. Contact us at The Equity Group if you need help with your security deposit disposition or anything pertaining to Visalia property management.