Florida landlords, let us put your mind at ease: dealing with security deposits isn’t that complex. Florida laws regarding security deposits and how you should handle them are clear. In fact, procedures for storing security deposits, reasons that landlords can take deductions, and how many days the landlord has to return a security deposit are all stipulated. Unfortunately, many landlords find Florida’s security deposit laws to be unnerving. Although the law does not favor either party, landlords can help reduce conflicts by understanding their obligations.
If you’re a landlord in Brevard County, or the surrounding area, here are five important facts you need to know about holding a tenant’s security deposits.
There Is No Security Deposit Limit in Florida
According to Florida’s landlord-tenant laws, there is no limit on the monetary amount of security deposit a landlord can request. A security deposit amount should be enough to cover you against minor damage to your rental property and potential vacancy costs. However, even without a limit, it’s advisable that a security deposit does not exceed two months’ rent. It’s important to note that excessive security deposits can turn prospective renters away and decrease your potential rental pool.
You Can Store Tenant’s Security Deposit In a Non-Interest or an Interest Bearing Account
Non-Interest Bearing Account
Most landlords choose to place their tenants’ security deposits in a non-interest-bearing bank account located in the state of Florida. It’s important to remember that any money collected as a security deposit must not commingle (be mixed) with any other unrelated funds or be used before it is due to the landlord.
Interest Bearing Account
Another alternative is to place the security deposit in an interest-bearing bank account (located in the state of Florida). If this option is used, you must pass any earned interest on to the tenant. How you pass the interest on will depend on your tenant’s preference. One option is to pay the interest directly to the tenant; alternatively, you can credit the earned interest back to your tenant to help offset their rent. Again, it’s important to remember that landlords must never commingle security deposit funds with any other monies or utilize the money before it is legally due to you. In addition, if for any reason the tenant defaults on their lease agreement, you are not due any interest earned.
You Must Return A Security Deposit Within 15 Days of Lease Termination
If your renters are model tenants and your rental property is left in good condition, you must return the security deposit within 15 days of lease termination. If the deposit was stored in an interest-bearing account, you must also forward any interest accrued on the security deposit throughout the lease.
You have 30 days from Lease Termination to Inform Tenants Of Deductions
If your property has any damage beyond regular wear and tear, or your tenant has defaulted on their rent, you may need to keep part of the security deposit. In this case, you have 30 days from the lease’s termination to inform the tenant in writing of your intentions. If you do not notify the tenant in writing within 30 days, you forfeit your right to keep any portion of the security deposit. Your written notice must clearly state how much of the security deposit you intend to keep and state the reasons why.
Statute 83.49 Governs Florida Tenant Security Deposits
The law that protects a tenant’s security deposit in the State of Florida is 83.49. This law defines what your obligations are as a landlord and what the responsibilities are of a tenant. If you’re planning on renting out a property — whether it be a single-family home or an apartment complex — you should familiarize yourself with this law. Understanding the law will help prevent disagreements between you and your tenants.
Get Help Managing Your Tenant’s Security Deposits
If you’re worried about navigating landlord-tenant laws on your own, let an experienced property management company take the reins. The experienced property managers at Rent In Brevard Property Management have the expertise to ensure that your rental business runs smoothly and you stay in compliance with your state’s landlord-tenant laws.
To learn more about how Rent In Brevard Property Management can help you manage your rental portfolio, click here.