Both landlords and tenants must have a good understanding of Florida security deposit laws. This helps minimize misunderstandings for both parties. On the other hand, HOA board members and managers may also benefit from it. After all, knowing these laws makes compliance easier and lowers the instances of disputes within the community.
Key Provisions of Florida Security Deposit Laws
The Florida Statutes Section 83.49 generally outlines Florida security deposit laws. It discusses what landlords are required to do when it comes to the collection, handling, and return of security deposits. Most rental agreements in the state, including those under HOA jurisdiction, are under the said legislation.
But what exactly is a security deposit? This is money that a renter pays to the landlord, which is returnable, as part of the rent agreement. It serves as proof that the renter intends to lease the property. Landlords may use it to cover possible damages caused by the tenant during the rent period.
Unlike some states, Florida doesn’t have a law that puts a limit on how much landlords can charge for security deposits. However, if you’re an HOA board member or property manager, you may want to make sure that what landlords set for deposits is reasonable.
How Security Deposits Must Be Handled
State law mandates that the collected security deposit should be kept in a separate account. Landlords may put them either in an interest-bearing or non-interest-bearing account in a bank in Florida. Alternatively, landlords may also post a surety bond in the county where their rental property is in.
Within 30 days of receiving the deposit, landlords need to notify the renter in writing. The said notice must include details such as:
- The name and address of the bank where the deposit is being held
- Whether the account earns interest or not
If a landlord fails to do these steps, they may face several penalties. Failing to follow these steps can result in penalties.
Returning a Security Deposit
When the renter moves out, the landlord only has 15 days to return the security deposit if no deductions are needed. If deductions are necessary, the landlord needs to send a written notice within 30 days explaining the reason for withholding the deposit. Tenants then have 15 days to dispute the claim.
Some of the common reasons for security deposit deductions include the following:
- Unpaid rent
- Excessive damage beyond normal wear and tear
- Cleaning costs, if the lease agreement specifies them
Landlords must document property conditions properly to prevent disputes. This documentation should clearly include photos or videos of the state of the property before and after the tenant lived in it. HOA board members may find it helpful to recommend this practice to landlords in their community.
Handling Security Deposit Disputes
Disputes often happen when landlords impose unfair deductions, delay returns, or handle security deposits improperly. Luckily, there are multiple ways to resolve these scenarios:
- Direct negotiation: The fastest way both parties can solve disputes is through communication. Landlords and renters simply need to talk through any issue or misunderstanding. For this, presenting pieces of evidence and receipts can quickly clear up any misunderstanding.
- HOA-facilitated mediation or arbitration: Your HOA can mediate when there’s a dispute between landlords and tenants. As the middleman, your HOA’s goal is to help both parties find a resolution that is fair on both sides.
- Legal action in small claims court: There are times when the two parties fail to reach an agreement. When this happens, renters can take legal action for deposits up to $8,000. This involves a more formal process, as both sides will need to present evidence before a judge.
The Role of HOAs in Security Deposits
HOA board members and managers need to make sure landlords stick to state laws. Given this responsibility, they should provide access to educational resources. It’s also good if your HOA performs routine checks on any rental property in the community. As mentioned, this also involves potentially becoming intermediaries between landlords and tenants.
Best Practices for HOA Managers and Board Members
As part of the HOA board, you must take proactive measures that will keep the neighborhood peaceful. Part of that is ensuring that everyone in the community follows security deposit laws in the state. Here are some of the best practices that you will need to achieve these goals.
Inform Landlords
The HOA board has the means to provide educational resources to landlords. On top of this, you must also update them about any changes in local laws. By doing so, your HOA can help landlords and renters understand each other better, minimizing the instances of disputes.
Standardize Lease Agreements
The HOA board should also encourage landlords to use standardized lease agreements. Having a set template helps them stay consistent and ensures that they are complying with state regulations.
For this, your HOA can provide templates. These may include security deposit clauses that are not too vague and minimize the likelihood of legal challenges. By doing this, your HOA can help streamline the process for both landlords and tenants.
Promote Thorough Documentation
Documentation is key to any transaction. So, as part of the HOA board, you should recommend proper documentation for landlords. This is best done with photos or videos before and after a tenant moves in and lives on the property.
Proper documentation can resolve disputes about the state of the property quickly. It also protects both parties against misunderstandings and possible legal challenges.
Develop Inspection Checklists
Inspection checklists are must-haves to ensure thorough property evaluation before and after a tenancy. These checklists need to cover all aspects of the property, including walls, floors, and ceilings. It should also include indoor fixtures and appliances, as well as outdoor fixtures and landscaping.
By having a template of the checklists for landlords to use, you help make sure that inspections stay consistent without overlooking important details.
Common Misconceptions
Disputes stem from misunderstandings, even when it comes to Florida security deposit laws. Here are some of the common misconceptions people have about them:
Interest-Bearing Accounts
Many believe that landlords need to deposit the security funds in an account that would bear interest. However, state law doesn’t require it, even if it allows the use of interest-bearing accounts. Landlords have the free option to use either an interest-bearing or non-interest-bearing account for security deposits.
Deductions for Wear and Tear
Usually, landlords treat wear and tear as damages to the property. This results in wrongful deductions for security deposits. They are not allowed to deduct routine rental maintenance or minor wear and tear from the deposit.
For this, landlords need to know how to differentiate wear-and-tear from actual damages made by renters, such as large stains, broken fixtures, or holes in walls. The HOA can help by educating landlords on this distinction. It helps lessen the probability of disputes while promoting compliance with state laws.
HOA Responsibility
A lot of people believe HOAs directly manage security deposits. This is not the case for all instances, though. Unless explicitly mentioned in the governing documents, the HOA doesn’t have a part in handling security deposits at all.
Conversely, however, the HOA’s role lies in guiding landlords in the community. They aim to help ensure compliance with the law through education, assistance, and even dispute resolutions for some scenarios.
Ensuring Compliance with Florida Security Deposit Laws
The rental process includes many factors, including navigating Florida security deposit laws. By complying with these regulations, both landlord and renter can build trust for each other. HOA board members and managers can also do their part in keeping this harmony between two parties through proper education, mediation, and support.
Do you need help navigating security deposit laws? A property management company may be able to help. Check out our online directory to find Florida’s best property management companies!
RELATED ARTICLES: