More Security Deposit Drama
May 22, 2011 8:13 AM   Subscribe

I am subletting a room in a four bedroom apartment from a person I met on craigslist. This person moved out/I moved in in March. He's still on the lease and I am also on the lease. Please help me understand how my landlord is handling our security deposits.


Long story short I was initially told that I would need first and last month's rent to move in. On moving day, I was told last month's rent was actually a security deposit. I wrote the former tenant a check for the deposit that day. Upon moving in and unpacking I discovered damage that had been previously hidden by the former tenant's decorations and furnishings: missing chunks of plaster and holes in the walls, paint stains all over the floor, and a large crack in one of the windows. I immediately e-mailed the former tenant and asked him not to cash my check. I then called the landlord and asked him to come to the apartment, look at the damage, and make a note of it. I also asked him to fix the broken window before I gave him my deposit.

He came to look at the room, didn't make note of anything, said he'd fix the window 'soon,' and told me to send him a check. Fast forward two and a half months of certified letters, phone calls, e-mails, a visit from the health inspector and a finally certified letter from the health inspector to my landlord ordering him to fix it, and and my window is finally fixed. I was there on the day that the repair took place (yesterday!) and when he finished I tried to give a check for the deposit. The landlord refused to take and directed me to give it to the former tenant.

Everyone I've spoke to over the course of this saga has told me that I would be an absolute idiot to write my deposit over to the former tenant rather than giving it directly to the landlord. The health inspector's office actually said it was illegal, but didn't elaborate on why. I'm not expert in this area at all, but over the past two months I've learned way more about landlord-tenant law and sanitary codes than I ever cared to. My feeling is that it would be a mistake to give my deposit to anyone but the landlord. The deposit is a relatively large amount of money and I don't want to write a check for money to some guy without some assurance that I'll get it back. Any guidance Metafilter could offer on this would be hugely appreciated. I'm in MA.
posted by chichimimizu to Human Relations (10 answers total)
Everyone I've spoke to over the course of this saga has told me that I would be an absolute idiot to write my deposit over to the former tenant rather than giving it directly to the landlord.

Yeah, pretty much. So, what happened? Did the previous tenant cash the check? If he has, I'm not sure what you can do. If he hasn't, call you bank and stop payment on it immediately.

In a perfect world, what should have happened is this:

-You go to the apartment and decide you want to live there.
-You walk through it with the landlord prior to signing a lease, and make note of any damages.
-Note damages on lease, then sign lease.
-Landlord pays previous tenant his security deposit, less the costs of those damages.
-You pay landlord your security deposit.

That the landlord is refusing to take the security deposit is hella shady. What happens when the next tenant moves in? If the next tenant can't or doesn't want to pay his security deposit, that means that you don't get yours back? That's why security deposits should only ever go through the landlord.

You should contact a tenants' rights agency in your area and see what they have to say.
posted by phunniemee at 8:46 AM on May 22, 2011

I immediately e-mailed the former tenant and asked him not to cash my check.

Has this check since been cashed? If not, cancel it ASAP.

He's still on the lease and I am also on the lease.

Why is he still on the lease? Is the landlord refusing to take him off?

I've rented many places, and the security deposit situation tends to depend on a single thing: whether each tenant has an individual lease with the landlord, or whether it's a shared lease with many names. What is the case in this situation?

In the case of individual leases (in my jurisdiction), all dealings are normally directly with the landlord. In the latter, however, everyone tends to sort things out communally: bills and rent are paid in common, and security deposits are exchanged between tenants since the initial deposit is with the landlord and has no reason to change. (Deductions due to estimates of repairs are taken into account in these exchanges, though.)

What this means, though, is that if it's a shared lease, the specific question of whether to give the deposit to the outgoing tenant or directly to the landlord would is a non-issue: you might've fucked yourself over by giving the deposit to the previous tenant without deducting damages (and your only recourse may eventually be small claims court). But the deposit is still a lump sum and would, upon termination of the lease, be distributed by the landlord equally to all tenants minus deductions, regardless of who caused the damage, because the landlord will neither know nor care who caused the damage. (This is the key point.) Conversely, if the repair costs exceeds the deposit, the landlord will pursue claims against any and all tenants remaining on the lease, again, regardless of who caused the damage.

That is what comes with having a common lease, at least where I live, and may explain why the previous tenant is still on the lease -- so that the landlord can potentially sue him for damages.
posted by matlock expressway at 9:13 AM on May 22, 2011

That the landlord is refusing to take the security deposit is hella shady.

It's possible that, like in Montreal where I live, security deposits are illegal and the landlord wants nothing to do with money he or she is not entitled to. This would explain why the health inspector told you such deposits were a no-no.

I advise contacting the local rental board and familiarizing yourself with their rules and regulations. Every area is going to be slightly different and advice from the hive is going to have biases related to what we know about our municipalities.
posted by Phalene at 9:17 AM on May 22, 2011

Response by poster: I cancelled the check I gave to the former tenant so that's not a problem. We have a shared lease. There are five people on it right now (four current tenants and the one former tenant). There was a ton of pre-existing damage to this place when I moved in and the landlord's lackadaisical attitude toward inspections between tenants makes me think that getting my money back will be impossible.

This is also about to happen all over again because one the the current tenants is moving out.
posted by chichimimizu at 9:19 AM on May 22, 2011

Why don't you just ask the landlord why you must give the deposit to former tenant IN WRITING?

Former tenant is still on the lease? Let him get his deposit back from the landlord IF or when his name comes off the lease. This is not your problem.

After sending that letter of inquiry to landlord, hang tight. Hold on to your money until you get written clarification.

If landlord never demands a deposit from you (in writing) so be it. Don't hand over the deposit to anyone without a written clarification on the process, a contract/lease, and a receipt.

Verify any responses you get from landlord with the local tenant's rights organization before proceeding.

Good luck.

(I can't guess why this situation developed, and you shouldn't either. Don't give your money to a fellow tenant still on the lease who doesn't live in your apartment. That's just crazy!)
posted by jbenben at 10:20 AM on May 22, 2011

Hi! I'm still confused.

You use the term "sublet" in this post. This implies that your tenancy is some limited, short term, and that other tenant is coming back? Which would explain why his name is still on the lease. Or has this term been bandied about because the group lease was already extant?

I think what has happened is that you gave first & last month's rent to the landlord, are still on the hook to give "security deposit" rent to tenant whose room you took. Upon taking possession, you find all kinds of damage. You alert the landlord who, with much hassel and grief, fixes your broken window but does nothing about the cosmetic problems.

This is what I think would happen: if you rent your room to another person while this group lease still holds, you will get the "security deposit" back from the incoming tenant. Your will not pay a dime for your last month of occupancy, because that money went upfront to the landlord. (If you only gave 1x rent to landlord, this does not apply!) If all of the current flatmates decide to leave en masse, again, your last month is prepaid (if landlord was just given rent x2), and the security deposit for the entire apartment will come from the landlord ... from the sounds of the guy probably in one check, to be divied by the flatmates. This deposit may have money deducted for damages and maintenance, (maddening and ironic since it sounds like landlord does very little, in the meantime, for upkeep) which you would then need to contest, then take to small claims, or, if that is too much of a life-sucking hassel, eat.

This is my advice, keeping in mind that IANAL and that I have been through so much landlord security crap that I look upon it as Vegas gambling:

• As mentioned above, find your local laws/tenancy group.

• Pay the deposit to outgoing guy. If the landlord doesn't seem to be making moves to hold you or he responsible for the cost of repairing the window, as he would if either of you had been perceived to cause the damage, then I would just write the full check and call it done.

• Document all the current damage. Sounds like landlord already did a visual inspection, and I know it's not right when you moved in, but take timestamped photos and find a MIMO (realtor's move-in, move-out) form on the web and fill that sucker out with every ding and nailhole and paintstain. Write the timeline (dates, actions) for the broken window on this form. This is for takin' it to the small claims court, should it come to that.

• Deep breath and relax. Bizness is done. I would now apply some sweat equity to feel like home is home, and not a slum. Goof-off does miracles getting paint off but use alot of ventilation! Spackling walls is very satisfying and takes not-much-time. Is it possible to repaint? It can be done in a weekend. If you are only in this place for a few months, doesn't have to go this deep. Rent a rug doctor and steam-clean your floor.

• When you move out, and your flatmates stay on you will get "security deposit" from incoming tenant, who will be thrilled to rent such a clean and well cared for abode, not knowing that landlord is a loon.

I don't understand why this is also about to happen all over again. Are you the first sets of switch-a-roo flatmates after an original group of four signed the lease at one time? The money part would go between leaving/incoming parties per room, because it is already very clear this is how the landlord is playing it. He only wants to pay out security if all four tenants are leaving at once. All that I would fight for from him is that he keep the tenant list current and strike out former, non-returning renters. If the next lease that comes up isn't right, strike out and initial the name of the gone party, keep a copy. It at lease shows that you are making an effort to keep the legal records current.

I know this type of rent agreement isn't the most legal, as other responders say, but it does exist, in a vague realm where IRL goodfaith interaction pwns SOPs and letter-of-the-law. This is the real world, and where landlords are concerned, there are 10,000 shades of shady. Ask yourself what would be better right now: finding a new place to move that has better policies with regard to signing leases, or to CYA and move on to get some sort of relaxation and enjoyment from your home. Good luck.
posted by Rube R. Nekker at 10:44 AM on May 22, 2011

I think you should send the old roommate a check for the deposit, minus an estimate of how much damage you think he did to the place before you got there. I don't really understand why this is such a problem. He paid a deposit when he lived there, correct? So you pay him back and now he is free and clear and you never have to worry about him again. When you move out, you don't have to get your money back from him, you have to get it back from the landlord.

If you don't think the landlord is going to pay you the deposit back when you move out, then that's a separate issue, but it has nothing to do with the fact that you're subletting, nor does it have anything to do with your old roommate. It's just a having-a-shitty-landlord thing, and if that's your concern and it's serious enough, then move out.
posted by dixiecupdrinking at 2:33 PM on May 22, 2011

I should add, this kind of arrangement ("paying it forward" with security deposits) is really typical in NYC, so maybe I'm jaded to the sketchiness of it, but it's worked out fine for me on three separate occasions.
posted by dixiecupdrinking at 2:36 PM on May 22, 2011

I'm in MA and this has been a common way of handling things in my experience, except a departing tenant wouldn't stay on the lease. In apartments I've been in, with group leases, a new tenant paid the security deposit to the person they replaced, and the landlord only paid back deposits when everyone moved out (with interest, split evenly among the group). There were never damage issues beyond typical wear and tear, though; I would probably want to negotiate a smaller deposit with the outgoing tenant, if it's not too late.
posted by songs about trains at 5:40 PM on May 22, 2011

The paying it forward thing may be common, but it is not legal in any jurisdiction I know of. OP check your rights here, but if you demand the formal process, the landlord must comply. Legally speaking, deposits for folks on the lease go through the landlord - period.

Good luck sorting this out.
posted by jbenben at 12:15 PM on May 24, 2011

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