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Updated about 2 years ago on . Most recent reply

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Kai G.
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Tenants don't agree on security deposit refund

Kai G.
Posted

Apartment was rented to tenant A and B as roommates (individuals). Tenant A paid entire security deposit on Avail platform, using ACH. After move-out, tenant B tells me he wants 100% of security deposit refund returned to him, made out to a company (probably owned by him), also at an address that does not match the address that was on the lease. I check with Tenant A, and he disagrees, indicates the two may have a dispute involving a business they both own. Tenant A tells me I should hang on to deposit until they agree on where to send security deposit refund. Tenant B then sends email to both Tenant A an myself, showing proof of deposit coming from a certain account (I only see last 5 digits), that he claims is the account of the business he wants me to return the money to. I replied I need a signed statement by both parties, telling me where to send the deposit, and whom to make the check out to. This was over 30 days ago, and they have not gotten back to me.

What would you do? Would you wait, or would you make the check out to both individuals and let them "duke" it out? If so, where do I send the check???

Most Popular Reply

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Nathan Brown
  • Property Manager
  • Phoenix, AZ
76
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Nathan Brown
  • Property Manager
  • Phoenix, AZ
Replied

Doesn't matter who paid it or from where. The deposit goes with the contract, not the people per se. You're obligated to return it one way or another regardless of what one of them instructs you to do. You're already 15 days late per FL tenant law, so to avoid further legal liability, send the check for the full amount with both names on it to the "primary" resident and let them settle their matter between themselves. If no address is provided, your remedy is to send it to the "last known" address. Which I guess would be the rental property. Hopefully they have mail forwarding set up through the post office.

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Nathan Brown
  • Property Manager
  • Phoenix, AZ
76
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101
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Nathan Brown
  • Property Manager
  • Phoenix, AZ
Replied

Doesn't matter who paid it or from where. The deposit goes with the contract, not the people per se. You're obligated to return it one way or another regardless of what one of them instructs you to do. You're already 15 days late per FL tenant law, so to avoid further legal liability, send the check for the full amount with both names on it to the "primary" resident and let them settle their matter between themselves. If no address is provided, your remedy is to send it to the "last known" address. Which I guess would be the rental property. Hopefully they have mail forwarding set up through the post office.

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Ned J.
  • Investor
  • Manteca, CA
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Ned J.
  • Investor
  • Manteca, CA
Replied

Send 50% to each tenant and they can figure out the rest...

  • Ned J.
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    Kai G.
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    Kai G.
    Replied

    Thanks gents. I sent a check with both their names.

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    Greg M.#1 General Landlording & Rental Properties Contributor
    • Rental Property Investor
    • Los Angeles, CA
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    Greg M.#1 General Landlording & Rental Properties Contributor
    • Rental Property Investor
    • Los Angeles, CA
    Replied
    Quote from @Kai G.:

    Thanks gents. I sent a check with both their names.

     This was the right thing to do in this situation. For the future, put a clause in your lease that says you have the right to return the security deposit to any party of the lease regardless of who paid it initially. 

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    Nathan Gesner
    • Real Estate Broker
    • Cody, WY
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    Nathan Gesner
    • Real Estate Broker
    • Cody, WY
    ModeratorReplied

    The easy answer: send one check made out in both their names. They can stand at the bank and argue about it while you continue living your life.

    • Nathan Gesner
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