Avoiding Security Deposit Disputes
The tenants have moved out, but evidence of their stay remains: nail holes and crayon marks on the walls, a coffee stain on the carpet, and scuffs on the hardwood.
The problems are obvious, but who pays to fix them can be murky. Security deposits can cover the cost of damages that go beyond reasonable wear and tear, but what’s reasonable is subjective and laws defining damage are vague.
A few scuffs on the walls or floors and a smattering of small holes from hanging pictures are normal wear and tear, according to Montgomery County Office of Landlord-Tenant Affairs, which has published a booklet to help owners and tenants navigate the issue. Painting the walls magenta (or any color) without permission or allowing Picasso Jr. to mark them with crayons is damage. Badly stained carpet is typically considered damage, but water-stained flooring near a tub is usually expected wear and tear.
How to Avoid Security Deposit Disputes
Careful inspections are key to document the condition of the property before and after tenancy and support any charges for damage. Experts suggest taking date-stamped photos or video of the unit’s condition during the move-in and move-out inspections as well as noting any problems in writing.
But inspections, deductions, and notifications must all be done according to local law, or landlords may forfeit the right to use the deposit or have to pay damages and tenants’ legal fees.
In Washington, D.C., landlords must notify tenants in writing of the time and place of the final inspection, which must occur within three business days after the lease is terminated.
Northern Virginia landlords must inform tenants they have the right to attend the inspection for damages and then notify them when it will take place if the tenant requests to attend. Inspections must take place within 72 hours after move out. If the tenant attends, the landlord needs to give the tenant an itemized list of any damages spotted during the walk-through.
After a tenant vacates, D.C. and Virginia require that landlords return deposits and send written notification itemizing any deductions for damages within 45 days. In addition to damages, landlords may typically withhold deposit money for any rent due, reasonable late fees, and legitimate costs stipulated in the lease, such as unpaid utility bills.
Currently, D.C. and Virginia require that security deposits be returned with interest for tenants of more than a year or 13 months in Virginia. Virginia will no longer require interest on security deposits for leases that begin in 2015.
While figuring out what qualifies as damage and how much to charge can be challenging and time-consuming for owners, professional property management companies have years of experience handling security deposits. Qualified managers are well versed in local laws and know where to look for damage and how to document it, ensuring owners can cover their costs and avoid problems.