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Multiple Tenants and Security Deposits

KenReynolds

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I`ve run into a situation with 3 vacating adult tenants who are friends of one another.

Although I was getting the rent cheques from one person, it was understood throughout the term of the lease that each was paying their own way. The person that regularly gave me the rent cheque each month has asked if I would divide the refund 3 ways.

Normally not a big deal (or is it?). But one of tenant`s bedroom has damage to the carpet that I need to deduct from the security deposit. The main person said to just deduct that portion from that tenant, divide the remaining deductions amongst the 3, and send a separate cheque to each.

Any suggestions?

And moving forward, what would you suggest (as far as collecting rent and security deposits and returning security deposits) when renting to multiple individuals.

Thanks, Ken
 

DonCampbell

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Hi Ken,

I always go back to the following two items.

#1 What does your lease state

#2 What do the Landlord & Tenant regulations tell you to do.

Not knowing what you lease states, I am going to the regulations. A post move-out inspectin must be done and signed by the tenants. Then, after reasonable repairs/cleaning is completed the Security Deposit is returned to the person on the lease (the main payer along with a copy of the move-out schedule. Then if they have roommates the main person can split the money accordingly and they can argue amonst themselves about the damage (rather than with you)

MOVING FORWARD:

How I work with this situation is (if it is one suite rented to a few people):

EVERYONE in the suite signs the same lease (making sure that if one moves out, the remaining can`t use the excuse of only paying a portion of the rent.

ONE person is named as the master controller, therefore you collect the rent from one person (as you have) and the security deposit is returned to them upon move-out. They can then write cheques to their roommates. You also make them VERY aware that damage to the suite is not going to be attributed to just one of the tenant, they will be treated as a `collective` meaning jointly responsible for everything that goes on in the suite.

Looking forward to hearing from others on how they deal with similar situations.
 

SamEfford

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I would deduct the carpet damage from the deposit, and then refund the check to whoever was on the Lease as the Tenant, be it one or all three. Include the reciept for the carpet repair and any other deductions, and let them decide how to best divide the remaining deposit.
 

KenReynolds

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QUOTE (DonCampbell @ Oct 9 2007, 12:36 PM) Hi Ken,

I always go back to the following two items.

#1 What does your lease state

#2 What do the Landlord & Tenant regulations tell you to do.

Not knowing what you lease states, I am going to the regulations. A post move-out inspectin must be done and signed by the tenants. Then, after reasonable repairs/cleaning is completed the Security Deposit is returned to the person on the lease (the main payer along with a copy of the move-out schedule. Then if they have roommates the main person can split the money accordingly and they can argue amonst themselves about the damage (rather than with you)

MOVING FORWARD:

How I work with this situation is (if it is one suite rented to a few people):

EVERYONE in the suite signs the same lease (making sure that if one moves out, the remaining can`t use the excuse of only paying a portion of the rent.

ONE person is named as the master controller, therefore you collect the rent from one person (as you have) and the security deposit is returned to them upon move-out. They can then write cheques to their roommates. You also make them VERY aware that damage to the suite is not going to be attributed to just one of the tenant, they will be treated as a `collective` meaning jointly responsible for everything that goes on in the suite.

Looking forward to hearing from others on how they deal with similar situations.

Hi Don,

Thanks for your comments. Even though I have been dealing with the one tenant, the lease has all 3 names on it. So my thought it to send a cheque to the forwarding address and put each of the tenant`s names on the cheque with an "and" between each name so they must all sign to cash the cheque. That way, each must sign the cheque in order to cash it. Then, as you suggested, they can fight it out amongst themselves as to who owes what.

Just so that I`ve got it right on the "moving forward" part. In future, do I make out 3 separate lease agreements with each individual or can I just make one lease, listing all 3 tenants, and get each to sign the one lease?

Thanks again, Ken
 

DonCampbell

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QUOTE (KenReynolds @ Oct 9 2007, 11:00 AM) Just so that I`ve got it right on the "moving forward" part. In future, do I make out 3 separate lease agreements with each individual or can I just make one lease, listing all 3 tenants, and get each to sign the one lease?

Thanks again, Ken

I would have one master lease agreement, but it is signed by all three. You are correct.
 

marcp

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I also have 3 adult tenants in a property, all three are on the lease.

I collect the total rent from one of them. If there was damage when they leave, I would deduct it from the damage deposit and return the remainder to the tenant I`ve been collecting rent from.

I have not explicitly named one person as the master controller on the lease. I hope that won`t complicate things later on.

marc.
 
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