I’m currently looking for a new apartment, and some of the places that I’ve looked at have said that there is a $0 security deposit with good credit.
How does this work? How is financial restitution made if you don’t return the apartment in immaculate condition at the end of the lease?
I asked one of the apartment representatives that question, but he didn’t know, so I’m asking you guys. Do any of you have experience with this?
A guess: They assume that people with good (excellent) credit are unlikely to trash a place.
And they send you a bill if you do and assume you’ll pay it.
Nah. Having been through this fairly recently, around here, the “no security deposit” apartments come with a $400 (or more) “application fee.” If you have a pet, some will also charge a “pet deposit” which is actually “pet rent” because you have to pay it in every year, and you won’t get it back once you move out.
Check your local laws, but this has been happening because in Chicago/Illinois, landlords are required to pay interest on any deposit that they are holding with the intent of returning it someday, nor can they spend your deposit before you move out, and then they have to provide an itemization of deductions on request. Obviously, they don’t have to pay interest on a lump sum that’s “not a deposit.”
So, in other words, you DO pay your security deposit, they just call it something else, and won’t give it back no matter how nicely you treat the apartment.
Scam scam scammity scam. The law has not caught up with the practice yet, so just avoid it if you can.
Yeah, “nonrefundable security deposit scam” was my thought. And if they send you a bill for the damage and expect you to pay it, I imagine it’s better for them. It’s probably much harder for you to take them to court over it, and if you contest it, they can just send the bill off to a bill collector who will trash your credit while you mount a legal defense.
Are you talking about paying last month’s rent in advance, or a security deposit on top of first and last month’s rent?
Here in Texas all the apartments are networked. You might be able to get away with it once, but good luck trying to ever get an apartment after that. Until you pay up, no complex is going to accept you.
Aside from that, the OP poses an odd question. HOW does ANY creditor deal with deadbeat customers? Simple, they fuck up their credit rating.
They’ll bill you and if you don’t pay that bill, it will be sent to a collection agency and thrown on your credit. I think they are operating under the assumption that someone with good credit would like to keep their good credit and wouldn’t risk it over a $500 bill.
It’s a pretty simple concept - they’re basically “loaning” you the deposit money, hence the credit requirement. If you trash the place they will “call” the “loan”. If you leave everything in good order nothing further is necessary. It seems like it would save the landlord some accounting and paperwork costs associated with a deposit escrow account and cutting a check back to the renter, but that may be offset by occasionally getting stiffed on a damage bill.
I had a place in Chicago that didn’t charge a security deposit. They told us that their reasoning was that it was more hassle for them to deal with it than it was worth, and that if there was any damage they’d send us a bill and sue if we didn’t pay.