I am the property manager for a property with three tenants. At the end of the lease term, one of the tenants decided to live alone and moved out. The two other tenants decided to sign a new lease and remain at the current rental property. The tenant that moved now wants her portion of the security deposit back. Because the lease requires that any refund of the security deposit be made payable to all tenants named in the lease, I am unsure how to handle the return or accounting of the security deposit for this tenant when two of the tenants are not leaving.
None of the tenants’ security deposit is due for refund or an accounting until 30 days after the remaining two tenants surrender the property. Generally, a landlord has a duty to refund and/or provide a written description and itemized list of all deductions on or before the 30th day after the day the tenant surrenders the rental property. “Surrender” is defined in paragraph 16 of the Residential Lease (TXR 2001) as “when all occupants have vacated the Property, in Landlord’s reasonable judgment, and one of the following events occurs: (a) the date Tenant specifies as the move-out or termination date in a written notice to Landlord has passed; or (b) Tenant returns keys and access devices that Landlord provided to Tenant under this lease.”
In a situation where there are multiple tenants in a rental property, “surrender” does not occur until the last occupant moves out. Even if one tenant has moved out of the property, returned the keys, given proper notice of termination, provided a written forwarding address and is not delinquent in rent, if the remaining tenants extend or sign a new lease with the landlord, the tenant would not yet be entitled to the security deposit because not all tenants have surrendered.
The remaining tenants may settle the splitting of the security deposit amongst themselves with the tenant who is vacating. This way the vacating tenant does not have to wait to see any refund or accounting of the security deposit and the property manager or landlord does not have to attempt to return a portion of the security deposit to the vacating tenant, especially when the landlord or property manager may not know what deductions may need to be taken out of the security deposit yet and because, under the lease, the tenants are jointly and severally liable for all provisions in the lease.
The Lease is still in effect and all parties that signed on the lease are still obligated to the terms(including lease payment) unless the landlord releases the party moving out (in writing). Until the lease expires or is otherwise terminated, the security deposit remains with the landlord. See the lease regarding terms for releasing the security deposit back to the Tenant(s) (in whole or in part).
It seems that if the one Tenant gives notice and makes the property available for inspection while at the same time the other 2 occupants are signing a NEW Lease then the old Lease is no longer in effect. In this case it was Terminated. Do the provisions of the old Lease some how transfer and take effect with the new Lease? It seems to me that the entire deposit should have been returned when the old Lease Expired. The new Lease should have been treated as all new including the Tenants with a new deposit. Would the Tenant that… Read more »
The signing of a new lease entitles a prior lessee to their portion of the deposit refunded on the previous contract, or itemization (with proof of deductions) within 30-days of their end date (on the initial lease she was a party to). If the new lease states the same amount of deposit, then the 2 signee’s are solely responsible and would pay the difference to the owner. Signing the new lease provides an easy answer. The 3rd lessee is not party to the NEW LEASE and is therefore entitled to her refund.
Hi Lisa, I am in this situation. My landlord will not return the deposit because my ex decided to stay in the rental. Are any there laws backing up what you say to combat paragraph 16?? Thank you so much in advance for your help!
Yes, but the scenario described here says that “the other two Tenants signed a NEW Lease. The original Lease expired. Nothing indicated nor said here about any extension. I understand the part about the deposit but I see NO LIABILITY (even though her portion of the deposit may not be paid to her) on the part of the person that moved out. The original Lease at this point has no weight except to establish that a deposit was paid.
so what happens if your a tenant with another person and you put the deposit and you move out within a month or so and you put the deposit but someone else moves in with the person you were living with but the landlord wants me to talk to the tenants and have them give me the deposit back