Security deposits: how to reclaim the money

Every year, some students have problems getting their deposits back. To avoid problems, follow a few simple steps. It may not be hard to get a full refund on your security deposit, but that doesn't stop several dozen Penn students each year from being unable to reclaim their money. In fact, nearly 80 students last year complained to the Office of Off-Campus Living that they were not given back their security deposits. So, how can one be sure of getting a full refund on a security deposit? "It is not only keeping your property in good shape, but also documenting and keeping track of things," Office of Off-Campus Living Director Mihaela Farcas said. She explained the five main steps to receiving a full refund. First, the tenant must check the apartment and document its condition prior to moving in, which can be done with the OCL's move-in checklist. Then, while living in the property, Farcas said tenants should "be careful, take good care of the property and leave it in a condition similar to the way it was in the beginning of the lease." Upon moving out, proper notification of lease termination is essential. The lease should specify the necessary notification set by the landlord. Inspection of the apartment upon moving out is also important. The tenant should compare the condition of the apartment at the end of the lease to the way it was in the beginning of the lease, Farcas explained. "Make a list of the damages, and keep a copy for yourself. It is sometimes even helpful to take a couple of pictures," she said. Lastly, the tenant should provide the landlord with a forwarding address in writing. Security deposits are often used to pay for any damage -- besides the usual wear and tear -- that the tenant may do to the apartment. It can also be used to pay for the tenant's debts. "The security deposit is not rent," Farcas said. "The purpose of the security deposit is for the landlord to be protected against any damages to the house or any unpaid financial obligations." In addition, Farcas noted the problems that can occur when living with other people off campus. She mentioned that a group living together should be aware that they might all be held partially responsible for the damages another tenant has done. A security deposit can vary in amount. For the first year, the landlord is legally allowed to ask for any amount up to the equivalent of two months' rent. After one year of living on the property, the landlord can only ask for the equivalent of one month's rent. During the beginning of the third year of rent, the security deposit begins accumulating interest at the rate of the bank in which it is invested. However, the landowner is allowed one percent of this interest to cover his or her administrative costs. The remaining accumulated interest is due to be paid to the tenant at the end of the year. The landlord has 30 days prior to the tenant's moving out to either refund the security deposit or to justify why it will not be fully returned. If neither happens, the tenant is allowed to take legal action. If the tenant disagrees with the landlord's failure to return the security deposit, legal action may be necessary. "If you do the right thing, and you document and give notification, the law is on your side," Farcas said.

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