All Forum Posts by: Freeman Schultz

@Patrick Liska: Thank you for the response.

In NJ the security deposit is a month and half of the rent. If there is an increase in the rent shouldn't the security deposit also increase?

For instance if the rent has been raised to $1000 so the security deposit should be raised to $1500. 

What do you think?

@John D I am still learning about real estate investing and I have been looking at the subject of evictions and dealing with late tenants and I began to think about if it is ever worth keeping a late tenant around. 

@Dana Dunford That makes sense. Even in a down market having a tenant who is late or stops paying rent is not worth having around.

I have been looking at investment properties and learning a lot about investing but I am a little confused about who pays for the increases in the safety deposit.

In a lease renewal, the rent will usually increase and so will the security deposit. But does the tenant pay for the increase in the security deposit?

For example, in New Jersey under N.J.S.A. 46:8-19 a landlord is required to place security deposits in bank accounts that pay at least the regular rate of interest. What I have heard is that the interest earned on the security deposit belongs to the tenant, and must be paid out in cash every year or subtracted from the amount of rent owed on each renewal of the lease. Can the landlord take the interest due and put it toward the security deposit increase?

During a bad market where vacancies care up and it is harder to find tenants, is it worth keeping a tenant who is late with the the rent and requires threats of evictions or is it best just carry over the vacancy assuming you have the resources to do so when the market gets better?

I am wondering about the following.

1. Tenant says they have no money for this month but they promise to make up for it by sending it next month. But they are still going to be a month behind. The tenant promises to make up for it a week later.

2. Tenant is late with the rent. Does not respond at any calls or letters.

From I have been reading and from the landlords and property managers I have spoken to, if the rent check is not received after the grace period the eviction occurs.  

Is it that cut and dry that there are no exceptions?

Thanks for the response. Just to clarify in this situation would the 10% be the appropriate amount?

How do you calculate the rent deposit when you have raised the rent. Let's say you do a lease renewal for a tenant and you raise the rent by 10%. Is the tenant required to provide that 10% to the rent deposit?

Thank you everyone for your responses. This clears up a lot.

When it comes to lease renewals how soon should the tenant get their new lease? Should it be a month before the current lease expires? How much time should you give for the tenant to respond? Once the lease is renewed, how do you figure the amount the tenant has to provide for the security deposit?

 I have been looking at some fixer uppers lately and some of them need to get their dishwashers and appliances fixed. Thanks for the response. I was thinking of that too that a big box store is probably the best place to go. I am going to check it out if the offer to take the old dishwasher away.