Rental Security Deposit: Understand how it works!
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Renting a property is an easier and faster way to have a place at your disposal. However, contracts like these require attention from the tenant (the person renting the property).
Therefore, it is common for the landlord (owner who leases the property) to request a rental guarantee, with the rental security deposit being one of the most common types.
In this way, the rental security deposit aims to provide financial security to the landlord and tenant, in cases of default!
But do you know what a rental security deposit is and how this category of rental guarantee works? So, follow this article and learn more about the subject!
What is a rental security deposit?
The rental security deposit is a form of financial guarantee for the landlord and tenant. After all, this modality consists of paying up to three months' rent in advance.
Therefore, in difficult economic times, the tenant is covered for a few months with the financial reserve, so that it does not harm the landlord's budget!
Furthermore, if there is no need to use the amount paid at the time of signing the rental agreement, the amount is returned to the tenant!
How does it work?
The Tenancy Law states that the landlord is responsible for choosing what type of guarantee will be used for that rental agreement.
Although there are several forms of rental guarantee, the rental security deposit is the second most used form, behind only the popular guarantor.
Therefore, if the landlord determines the rental security deposit as a requirement of the lease agreement, the tenant must have the established amount on hand at the time of signing the document.
Typically, the amount required as a guarantee for the rental deposit is the maximum amount corresponding to three months' rent for that property. But be careful, asking for an amount greater than three months' rent is illegal!
This way, if there is any problem with the rent payment, the landlord already has a guarantee. However, remember to only deposit the money into the landlord's savings account after the contract is confirmed!
Furthermore, the savings account must be in the joint name of the landlord and tenant and all transactions must be officially reported!
When can I use the rental deposit?
As you have already seen, the rental deposit is a guarantee and is in the name of both parties (landlord and tenant). Therefore, the amount should only be used by mutual agreement.
Therefore, the use of the rental deposit is only permitted in cases of tenant default, damage to property, agreement between landlord and tenant or other situation authorized by court order.
However, if there were no problems during the rental period, the landlord must return the full amount of the savings account to the tenant, corrected with interest!
However, in some situations, the landlord and tenant agree that the deposit amount will be used to pay the last three months of rent.
This way, the landlord does not need to return the money and the tenant has three months of rent paid off.
However, if the contract is renewed, the amount for the three months remains in the savings account until the property keys are returned.
Finally, always remember to read rental contracts carefully, as landlords and tenants have rights and duties!
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