First, last and security?? : ezLandlordForms

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Nicole H

started a topic over 12 years ago

I want to charge my new tenant first month's rent, last month's rent and a security deposit ( equal to one month's rent) since the last wonderful tenant decided to skip out without paying for the last month. Is this against the law in Ohio? Where can I find the laws governing this issue?

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Bob R

said about 12 years ago

Consider the following: 1. Security Deposits are not considered as income unless it is used for repairs, late rent, etc after tenant moves or for repairs during their stay. Therefore, the $$$$ collected as Security Deposit do not have to be claimed as income the year collected. 2. If you call a deposit "last months rent", it must be claimed as income the year collected. 3. Assume you call a deposit as last months rent. The tenant is your tenant for 5 years. During the 5 years the rent was increased from $500 to $750. When the tenant leaves (5th year) the last months rent is $500, not $750. You just lost $250.

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Doug H

said about 12 years ago

You're better off charging first months rent and two months security, IF it's legal in Ohio, because you can't subtract for damages from rent but you can subtract from a deposit. In addition a security deposit can be used to cover unpaid rent. Finally, if they do the use the security deposit as the last months rent thing (even though it violates the lease), you still have a month to cover damages. Also, if they do the take the last month from the security deposit thing, the late fees kick in if the lease is written correctly. So for example, let's assume a $500/mo lease, a 2 month security deposit, and a $10 / day late fee after 3 days late. The lease says that late fee's are added rent and that the security deposit may not be used for the last rent but that any monies owed to the landlord may be deducted from the security deposit. Tenant decides to do the 'use my deposit as the last months rent" thing. Politely inform the tenant that the lease stipulates that the tenant may not do that, and that if they do not pay the rent as proscribed in the lease late fees will apply and legal proceedings may happen. At the point where your state says you can send the pay or quit notice, send it, with the late fees on the notice. If you end up proceeding to court (go EVEN IF THE TENANT IS OUT BEFORE THE COURT DATE). So lets say it takes 5 weeks to get to court, and one week for the notice and so forth, for a total of 42 days, 39 of which have late fees. Let's say that there was $125 in damages and such. So it's the last months rent at $500 plus $125 in damages plus $390 in late fees plus Curt Costs and Legal fees. We'll say the last 2 are $0 cause I have no clue on them. At any rate just the first 3 are $1015, which is over the $1000 you have in deposit. BUT what if it had been $750 in damages? Then you'd be out a lot more. Higher deposit is always better than pre-paid rent.

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Anthony O

said over 12 years ago

I have always done first , last and security deposit and its been a blessing!! If they can pay this up front then they can pay there bills, I also have a lease signing to be protected. This site helps answer all the questions you have, for example when making a lease on this site its state specific and will tell you how to deal with security deposit's and such questions you may have:0)

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L. L

said over 12 years ago

what are the specific laws regarding how a security deposit is kept, and the time frame of returnig the monies owed ? after it has been ackledged that the property was damaged, how do I use the money from the security deposit, and what is the time frame to do this? Is it better to take a first and last month rent rather then a security deposit. I live in PA.