Legal: Because the law obliges you, as a Landlord, to keep
the tenant's advance rent and security deposit in the following manner:
1) Whenever money is deposited or
advanced by a tenant on a rental agreement as security for performance of
the rental agreement or as advance rent for other than the next immediate
rental period, the landlord or the landlord's agent shall either:
(a) Hold the total amount of such
money in a separate non-interest-bearing account in a Florida banking
institution for the benefit of the tenant or tenants. The landlord shall not
commingle such moneys with any other funds of the landlord or hypothecate,
pledge, or in any other way make use of such moneys until such moneys are
actually due the landlord;
(b) Hold the total amount of such
money in a separate interest-bearing account in a Florida banking
institution for the benefit of the tenant or tenants, in which case the
tenant shall receive and collect interest in an amount of at least 75
percent of the annualized average interest rate payable on such account or
interest at the rate of 5 percent per year, simple interest, whichever the
landlord elects. The landlord shall not commingle such moneys with any other
funds of the landlord or hypothecate, pledge, or in any other way make use
of such moneys until such moneys are actually due the landlord; or
(c) Post a surety bond, executed
by the landlord as principal and a surety company authorized and licensed to
do business in the state as surety, with the clerk of the circuit court in
the county in which the dwelling unit is located in the total amount of the
security deposits and advance rent he or she holds on behalf of the tenants
or $50,000, whichever is less. The bond shall be conditioned upon the
faithful compliance of the landlord with the provisions of this section and
shall run to the Governor for the benefit of any tenant injured by the
landlord's violation of the provisions of this section. In addition to
posting the surety bond, the landlord shall pay to the tenant interest at
the rate of 5 percent per year, simple interest. A landlord, or the
landlord's agent, engaged in the renting of dwelling units in five or more
counties, who holds deposit moneys or advance rent and who is otherwise
subject to the provisions of this section, may, in lieu of posting a surety
bond in each county, elect to post a surety bond in the form and manner
provided in this paragraph with the office of the Secretary of State. The
bond shall be in the total amount of the security deposit or advance rent
held on behalf of tenants or in the amount of $250,000, whichever is less.
The bond shall be conditioned upon the faithful compliance of the landlord
with the provisions of this section and shall run to the Governor for the
benefit of any tenant injured by the landlord's violation of this section.
In addition to posting a surety bond, the landlord shall pay to the tenant
interest on the security deposit or advance rent held on behalf of that
tenant at the rate of 5 percent per year simple interest.
(2) The landlord shall, within 30
days of receipt of advance rent or a security deposit, notify the tenant in
writing of the manner in which the landlord is holding the advance rent or
security deposit and the rate of interest, if any, which the tenant is to
receive and the time of interest payments to the tenant. Such written notice
shall:
(a) Be given in person or by mail
to the tenant.
(b) State the name and address of
the depository where the advance rent or security deposit is being held,
whether the advance rent or security deposit is being held in a separate
account for the benefit of the tenant or is commingled with other funds of
the landlord, and, if commingled, whether such funds are deposited in an
interest-bearing account in a Florida banking institution.
(c) Include a copy of the
provisions of subsection (3).
Subsequent to providing such notice, if the landlord changes the manner or
location in which he or she is holding the advance rent or security deposit,
he or she shall notify the tenant within 30 days of the change according to
the provisions herein set forth. This subsection does not apply to any
landlord who rents fewer than five individual dwelling units. Failure to
provide this notice shall not be a defense to the payment of rent when due.
Obviously compliance with these requirements is beyond the organizational
and involvement level of most individual property owners or they would not
need our services. If you fail to follow these directions you risk being
barred from imposing a claim on the security deposit if the tenant breaks
his/her lease, causes damage etc. We maintain a separate, non-interest
bearing account for these deposits and can account for them should the need
arise.
