It’s easy to make a mistake when you’re renting out a St. Louis property, and one of the areas that is especially risky is security deposits. There are strict laws that need to be followed when it comes to collecting, holding, and returning a resident’s security deposit in Missouri. Even an unintentional error can result in a tenant claim that will come with steep financial penalties.
Today, we’re taking a look at some of the most critical things to know when you’re managing your security deposit in St. Louis. Remember that the best way to avoid mistakes is by working with a professional property management company. We understand the security deposit laws and best practices, and we’ve been dealing with deposits for many years.
Collecting a St. Louis Security Deposit
Missouri law limits the amount you can collect as a security deposit. You can’t ask for any more than the equivalent of two months’ rent. This means that if your rental amount is $1,200, your security deposit cannot exceed $2,400.
Just because you can ask for two months’ rent as a security deposit doesn’t mean you should. If you’re renting a home to a well-qualified resident with a solid rental history, asking for that much money upfront could deter them from choosing your home. Establish a reasonable security deposit amount that protects your property from excessive damage and keeps your property competitive and attractive to well-qualified residents.
Returning a Security Deposit: Wear and Tear vs. Damage
When it’s time to return the security deposit, you’ll need to decide whether the resident is getting the full amount back or whether you’re making deductions from it.
Landlords and St. Louis property managers can withhold money from the security deposit for the following reasons:
- To cover any unpaid rent.
- To clean the home and return it to the condition it was in when the resident took possession.
- To pay for any damages that were caused by the resident’s abuse, misuse, or neglect of the property.
- To cover the costs incurred by a resident’s early termination of the lease agreement.
Those tiny nail holes in a wall are considered general wear and tear, and can’t be deducted from a deposit. However, stains on the carpet from a child’s finger-painting projects are beyond wear and tear and can be deducted.
Returning a Security Deposit: Timelines
You’re required to return the resident’s deposit within 30 days of move-out in Missouri. If you’re going to withhold some or all of the deposit, instead of sending the full amount you’ll return whatever is left after you’ve made your lawful deductions. Include an itemized statement so the residents understand what was deducted and why.
Penalties for Security Deposit Mistakes
In St. Louis and throughout Missouri, the resident can file a claim, take you to court, and recover damages equal to twice the amount of the security or the amount that was withheld if you are found to violate the timelines or the acceptable legal standards for withholding money.
Ask for help from a professional St. Louis property management company. We’ll make sure you’re compliant when it comes to security deposits and anything pertaining to leasing and management in St. Louis. Contact our team at Amoso Properties.