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Security Deposit question..

Posted by jvlxv1 (My Page) on
Sun, Jun 21, 09 at 10:55

Hello everyone i am new to the forum, I have a question.

I am a college student and i grouped up with a bunch of friends to rent out a house. I was obligated to pay for a security deposit of $800 which i paid, but I did NOT sign the lease.

There are alot of complications and I wish to back out of this house and I was wondering if I would forfeit my security deposit even though i did not sign the lease yet?

thank you everyone, happy fathers day!


Follow-Up Postings:

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RE: Security Deposit question..

To whom did you pay the security deposit--the landlord or one of your fellow tenants? Was this security deposit just for you, or did it cover the entire group? Have you moved in yet? It's very unclear from your post exactly what is going on. Give us a few more details and we'll try to help.


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RE: Security Deposit question..

Who did you pay the deposit too? Did you get a receipt for the deposit?

You didn't sign the lease so I doubt you paid the landlord.


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RE: Security Deposit question..

Legally you would not be under contract for the deposit, so you should be entitled to get your deposit back.


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RE: Security Deposit question..

hey guys thank you for the response! well i wrote the check out to a company that i guess takes care of this. one of the tenants is doing the collecting so i wrote out the check. i did not move in yet, signed NO lease yet, and the security deposit was just paid for me

please keep responding guys, this is a TON of help.


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RE: Security Deposit question..

So, if I'm understanding this clearly:

You were going to go in on apartment with other roommates. The Security Deposit was split among the roommates. You paid your share of SD, but have not signed any contract yet. Is that correct so far?

To clear up some things:

-To whom did you make the check payable, Mgmt Company (if I read correctly), not roommates?

-Have your roommates signed a lease yet?

-What State do you live in? I ask because there is a chance, albeit slight, that by handing over $, even if it's a Deposit, some states might view that as becoming party to a contract, since money exchanged hands. (I'm personally doubtful that will be the case, but you never know. State laws vary widely, some are generalized and vague, some quite explicit. And if you're in a major Metro area you could end up having legislation that has differences from the State's)

Here's my humble .02:
If you did not sign a lease, but handed over your share of SD to roommates and roommates have signed a lease, you're going to have to get the money back from roomies. If you did not sign a lease, but handed over your portion of SD to Mgmt, since you've signed no legally binding contract I'm not sure how Mgmt can justify keeping your $$.

If you did not sign a lease, paid a portion of SD, and your roommates also did not sign a lease yet, I'm wondering why it transpired that way? Because typically no money exchanges hands (unless it's minor like App Fee or Credit Check fee, etc.) until a lease is signed. Only then is Rent and Sec Dep collected. IOW, I just don't get why a SD is being collected on a unit that has no lease on it. Not sure how LL or Prop Mgr can justify it. But again, it depends on law.

If you could offer more info it would help to determine your next move. ;)


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RE: Security Deposit question..

oh my thank you so much! here's my info!

1)For school this year I was going to live off campus and we found one of those houses that were split into different rooms.
2)everyone that was going to live in the house each paid a security deposit of $800, which I did.
3) Did not sign a lease but everyone else did in the house.
4)I did not write the check out to one of my roommate's names, its actually written to a store like name, but for example it was like "Tiny Forked River LLC"...what does the LLC stand for?
5)This is taking place in New Jersey

One of my roommates is trying to get fresh with me saying that I will forfeit my SD because i havent found a replacement. It's his fault in the first place that he recruited people for this house and now I'm stuck in a room that I did not like and paying big bucks for a room i do not want is not worth it for me. I'm sure because I did not sign the lease I can somehow back out, like is there a way I can work about getting my $800? I do not know where to turn for help...

Thank you guys SO much.


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RE: Security Deposit question..

LLC stands for Limited Liability Company.

I've skimmed some of NJ law (sorry don't have lots of time, have to take my car into the shop). I am just not seeing how they were justified in taking a Sec Dep before a lease was signed.

I found Legal Services of NJ site. It explains Sec Dep Law. If you go to the bottom of the page there is a toll free #. I'd suggest giving them a call and see what they have to say about it.

NJ is very specific about how Landlord's are to handle Sec Deps. But I could not find mention of collecting a SD before lease signing. Again, I didn't read the law through and through, but I suspect you are not obligated to these people since you did not sign a contract with them.

I'd be curious to know what you find out.


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RE: Security Deposit question..

hey there!

so i called the number and unfortunately i do not qualify for the service they were offering so no questions could be answered :-(


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RE: Security Deposit question..

"We found one of those houses that were split into different rooms."

Would that not describe the typical house??

Or are you trying to describe a boarding house where each person is contracted separately?

"It's his fault in the first place that he recruited people for this house and now I'm stuck in a room that I did not like and paying big bucks for a room i do not want is not worth it for me."

It sounds like you are trying to back out of a deal on a whim. You have not explained how this is "his fault". But that is a moot point. What really matters here right now is where you stand legally. Why did you not get a receipt for your SD? If you wrote the check to the LLC you should contact THEM first to see what they say. Have you done that yet? If you did not sign a lease with them they may not even know you exist. Why did you not sign a lease when you forked over the money. What was the reason? Always get everything in writing. Have you seen a copy of the lease the roommates signed? Does it have a 'no sublet' clause in it? There is not a lot of info to go on here and Moonshadow has given some great tips on how to proceed.

"I'm sure because I did not sign the lease I can somehow back out, like is there a way I can work about getting my $800? I do not know where to turn for help... "

If you did not sign a lease you are not obligated to make payments on the lease.

As far as getting your $800 SD back, it looks like you will have to go to small claims court. You have no paperwork or receipts to back up what you say the agreement was, and the only evidence you have is your canceled check. I hope you wrote *Security Deposit* on it before you handed it over to be cashed. You need to contact a tenants rights group in you area for more info on how to proceed with your dilemma.


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RE: Security Deposit question..

OK, well here's a few more pennies worth of my thoughts, and my suggestion, best I can come up with after mulling this over.

One concern was that since you gave them $ for a Sec Dep, that they could hold you to come kind of legally binding verbal agreement. But, if they tried to use that argument, I don't see how it could hold up. Please bear in mind I am not a lawyer. I did some searching. The three elements for a binding verbal contract are Offer, Acceptance, and Consideration. You can read more on that here. So in your case (and this is just my humble interpretation) the Offer would have been to rent a room from Tiny Forked River. The acceptance would have been your voluntary agreement to rent that room. The consideration would be the exchange of something of value. Your money in exchange for the use Tiny Forked River's room in a house. But that doesn't set right with me for a couple reasons (more on that below).

I checked, and NJ does allow for verbal leases. (If you check NJ Lease Information Bulletin, it says this: A lease is an agreement between a lessor (landlord) and a lessee (tenant) which may be verbal or
written. A lease grants possession to the tenant for use of a dwelling unit for a specified period
of time in return for rent.
)

But here is what I have an issue with as far as it having potential to be a verbal agreement. Again from NJ Lease Info Bulletin, under the Terms section: If the lease is verbal the term will began on any
day agreed upon by the parties to the lease.

So, did you specifically agree on a day that a lease would commence (despite the fact that you signed nothing)?

Also, and this could be a technicality, but traditionally a Security Deposit is taken at time of Lease signing, and it's to be held and assigned for specific purposes and uses during term of the lease, according to State law. Sec Dep is typically not used as collateral to "hold" a unit. So if my understanding of verbal leases is correct, it's not the Sec Dep that makes it binding (or would be viewed as the Consideration portion of a verbal agreement). Rather the payment of rent money in exchange for living in the unit would be the Consideration portion of a verbal agreement. You've neither paid any money that you were told was put toward rent, nor have you lived in or had use of the unit, correct? So if that's the case, then the last element of a verbal agreement (Consideration) is missing. You didn't technically give $ to live in the unit and you didn't have access to their unit.

Another thing bothering that might shoot down the verbal lease agreement argument is inconsistency. Because other occupants of the unit signed a written agreement. It doesn't make sense, when all parties involved are living under the same roof, that some tenants would have a verbal agreement and some a written agreement when all are under the same roof.

If there's some misinformation in my conclusions above (such as you did have access to the unit as your own), please post additional details.

If my thinking is pretty close along the lines of what actually transpired, my suggestion would be to send them a letter. Certified so they have to sign for it.
Something like this:

Tiny Forked River LLC
123 Maple Street,
Somewhere, NJ 12345

Attn: Property Manager

Please be advised that on (insert date) I gave you my check # ______ in the amount of $_______ for what I understood to be a Security Deposit on a unit I was going to share with others under a written lease agreement.

Although others signed an agreement to rent the premises at _________(address), I have never signed any written agreement with you to lease any property you rent out. Since I didn't sign any agreement or contract indicating my agreement and acceptance of rental terms, any contract currently in force on this particular unit (or any other you have) should not include my name as a party to a contract. Also, I have never paid you any rent for use of any of your premises.

I have decided to sign a lease elsewhere (even if you haven't you probably eventually will, so I'd toss that in). Therefore I will need the money back to put toward the lease agreement I sign.

Since we don't have a lease agreement together, I am requesting that my money in your possession be returned to me in full. I will appreciate having my money returned by (insert date, maybe give them 5 business days after the time it takes for them to receive your letter).

Sincerely,


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RE: Security Deposit question..

Here's my humble .02:
If you did not sign a lease, but handed over your share of SD to roommates and roommates have signed a lease, you're going to have to get the money back from roomies. If you did not sign a lease, but handed over your portion of SD to Mgmt, since you've signed no legally binding contract I'm not sure how Mgmt can justify keeping your $$.
While I agree with this in principle, I think that even though you wrote the check to the landlord, you gave it to your friend, who used it as security deposit for a lease he did sign. I doubt the LL has an obligation to return it, unless you personally gave it to them with the understanding it was specific to a lease you were going to sign individually with them. As far as they know, that check could have been a gift or loan to your friend from his parents or anyone. They accepted it from your friend as the security deposit for the lease they signed with your friend. It is not their problem where your friend got that money from, they will just return it, or not if their are damages, at the end of the lease term or when your friends move out. I think you will have to get it from your friends, and while you could always take your friends to small claims court if they don't pay it, honestly I don't think you have a very good case and I tend to agree with them. You agreed with your friends to rent this place together and you apparently backed out after they signed the lease, with little notice, and without finding a replacement. You have put them in a position where they have to cover the rent you agreed to pay. I do think you entered a verbal agreement; not with the landlord, but with your roommates, and they have the right to use your security deposit to cover the extra rent they now have to pay while they look for a replacement. Unless they've already found a replacement and are not covering your share of the rent, in which case you are definitely entitled to your money back.


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RE: Security Deposit question..

"I wouldn't hassle with letters, I would call to set up an appointment and bring a friend with you if need be to make you feel more comfortable."

Good luck managing your buildings without a papertrail to record communications between tenants and landlord.

A "meeting" with a friend tagging along, is not the way to handle it - unless that friend happens to be an attorney.

Better yet, just send the attorney to meet with them or have the attorney write a letter to them, and stay home.


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