Deposits and Tenants changing their minds

[Damian Callaghan]

We are about to rent our home and move in to a bigger family home. I found a tenant and we both signed a contract. I am in a HOA that had some stipulations. The intent was to take 1 month rent and 1 month as a security deposit but I just took 1 mth until they got approved by the HOA. I did open a separate bank account and deposited the 1 month. There was a fair bit of back and forth as the tenant didn't have a SSN and the HOA wanted background checks but the tenant had lived on the same development for 2yrs. They were eventually able to provide evidence of good standing and background check from their current mgmt agent. I did agree to give full refund of anything went wrong with hoa applications. Nothing did! But the client txt to say their current mgmt company and landlady made a mistake and they don't have to vacate their current property. In other-words mistake or change or mind. I am reviewing the contracts but wanted to ask the forum on if I am obliged to refund the deposit… one additional point. I have offered to give a full refund if I find a tenant before their expected move in date - if I am not out of pocket I am inclined to be fair. This is my first time as a landlord and this makes for awkward circumstances but it is also a business and not a charity - where do I stand?