Holding the Security Deposit

[iacino]

What is the name of your state? Florida

I was told to put the security deposit into an escrow account or interest-bearing account. Don't know what those are so would checking or savings account suffice? Problem with a bank account is that there are monthly fees and I stand to lose money that way. What about putting it in a safe at home? Or why can't I shove it under the mattress? Why am I forced to open a bank account?

 

[HRZ]

The law says so...but at least in my state I've never had a challenge to where I put it...the problem most often arises if you owe some back but are unable to pay because you spent it .

 

[iacino]

Is a checking or savings account considered an escrow account?

 

[FarmerJ]

Go to your bank and ask them if you can open a account to be used for a tenants deposit funds, if they cant or don't have that kind go to another bank.

 

[Zigner]

What is the name of your state? Florida

I was told to put the security deposit into an escrow account or interest-bearing account. Don't know what those are so would checking or savings account suffice? Problem with a bank account is that there are monthly fees and I stand to lose money that way. What about putting it in a safe at home? Or why can't I shove it under the mattress? Why am I forced to open a bank account?

Are you really saying that the extra few dollars per month that it would require to maintain the legally required account would cause you to lose money on the property rental? If so, then you should sell and get out, because, heaven help you if you ever have to do any maintenance - it would wipe you out!

I suspect that you mean that you'd end up having a few dollars less of a profit if you actually obey the law...and you don't like that.

Here is the law on security deposits in your state. Read it. Learn it. http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0000-0099/0083/Sections/0083.49.html

 

[Just Blue]

What is the name of your state? Florida

I was told to put the security deposit into an escrow account or interest-bearing account. Don't know what those are so would checking or savings account suffice? Problem with a bank account is that there are monthly fees and I stand to lose money that way. What about putting it in a safe at home? Or why can't I shove it under the mattress? Why am I forced to open a bank account?

You chose to be a LL and with that choice there are legal obligations you must perform. If you find this is just too much bother...sell the property.

 

[iacino]

Called Wells Fargo and routed to "3" different people who could not help me setup an escrow account for tenant! They were baffled! I don't think too many landlords are following the law.

 

[Zigner]

Call Wells Fargo and spoke and routed to "3" different people who could not help me setup an escrow account for tenant. I don't think too many landlords are following the law.

Frankly, an "escrow account" is not what is required. READ THE LAW.

 

[iacino]

I've read it and that's why I'm here. It is not clear and specific. I asked you if a checking account would suffice and you couldn't even answer.

 

[HRZ]

You need to set up an account as required by law...a bank can do it...if there is a fee to do so....learn to adapt going forward .

If you fail to follow the rules you may be up a creek w/o a paddle if later you need a deduction from security.

Whether you or I ignore the administrative hassles of such accounts....you need to be aware of downsides ...or get out of being a LL....the tenant will be "right" if you cut corners on law and some future beef arises

Basically these are tenant funds entrusted to you for safekeeping ...and you are supposed to do so as set forth in state law

If you got it wrong 3 places I'd be real worried about what else you got wrong or left uncovered.

 

[Zigner]

I've read it and that's why I'm here. It is not clear and specific. I asked you if a checking account would suffice and you couldn't even answer.

The law states that you most hold it in an account "For the benefit of..." the tenant. If your bank doesn't know what that means, find a different bank. Furthermore, you would be wise to find a landlord association that can help you out. They're out there, but we don't give referrals.

 

[Zigner]

How many units do you rent out?

 

[iacino]

Can you just answer my questions instead of preaching and going on tangents? Are you a judge?

 

[Zigner]

Can you just answer my questions instead of preaching and going on tangents? Are you a judge?

Nobody is preaching.
Nobody is going off on tangents.
You would be wise to watch the snark with the volunteers here.

 

[iacino]

Both of you are preaching. Why didn't HRZ answer my more important question in the other forum? Why not help me with a lawsuit than this frivolous subject? I don't get it!