Return of security deposit

[Marcus Hendren]

Going to attempt to be brief yet get all the details: Bought a turnkey property rented to 5 student tenants starting a 12 month lease from Aug 2014 to July 2015. 4 moved in and one apparently got kicked out of school and did not move in. He was uncooperative in communicating with me when I was searching for another tenant to replace him. When I did find a new tenant, I signed a completely new lease with him starting in September, immediately collected one months rent and a prorated security deposit. Uncooperative tenant's portion of the rent was not paid for august, but security deposit equals the missing amount. Now the uncooperative tenant wants his security deposit back. Do I return?

[Bill S.]

@Marcus Hendren what does your lease say? I would be careful about using his SD for unpaid Aug rent or as liquidated damages without a termination agreement in place. What if he paid rent and late fees? You then would have rented the property to two people. Technically the SD can be used to pay for unpaid rent but again unless the uncooperative tenant has told you in writing that he is not going to move in then you could end up in a difficult situation. If the tenant is very smart or knows someone who knows landlord tenant law. 

What ever you decide to you you must send an accounting of the security deposit. Be sure you do it within the time specified by your lease or state laws if the lease is silent. It might be a good idea to review your state law to make sure the lease is correct.