What is a Security Deposit?
By definition, a security deposit is a sum of money given to the landlord to ensure that rent will be paid and other responsibilities of the lease performed. Such responsibilities include: paying for damages to the premises caused by the tenant, covering any unpaid bills, and the cost of re-renting the premises after breach by the tenant. The laws surrounding security deposits vary from state to state. Landlords must follow state law when handling tenant’s security deposit, which means using it only for certain expenses and returning it tenants in a timely manner.
North Carolina Law
North Carolina requires that security deposits from the tenant in residential dwelling units be deposited in a trust account with a licensed and federally insured depository institution lawfully doing business in this state. Security deposits from the tenant may be held in a trust outside of North Carolina only if the landlord provides the tenant with adequate bond in the amount of said deposits. Landlords or their agents are required to notify tenants within thirty days after the beginning of the lease term of the name and address of the bank or institution where their deposit is currently located or the name of the insurance company providing the bond.
When Can a Landlord Withhold Security Deposits?
As a tenant and as a landlord, it is important to be privy to landlord’s obligations to security deposit guidelines. Below is a list of scenarios detailing when a landlord is prohibited from keeping security deposits and when he must return them.
Remedies for Getting Deposits Back
A tenant is allowed to institute a civil action to require the accounting of and the recovery of balance of a deposit if the landlord (or landlord’s successor) in interest fails to account for and refund the balance of the tenant’s security deposit pursuant to this Article. The failure of a landlord to comply with the deposit, bond, or notice requirements of this Article shall nullify the landlord’s right to retain any part of the tenant’s security deposit as otherwise permitted under G.S. 42-51. Additionally, the tenant may recover damages resulting from noncompliance by the landlord. Such damages include cost for an attorney and court fees.
An eviction is a process that allows a landlord to lawfully remove a tenant from the leased premises. In North Carolina, this can be a long and/or tedious process. There are four basic reasons that permit the eviction of a tenant:
When filing for an eviction, as the landlord, it is important to understand that even if the eviction is justified, the tenants can always find some way to defend themselves. Because of this, it is best that the landlord do their research before beginning the eviction process in order to know what is coming their way.
Nonpayment of rent
If a landlord is looking to evict their tenant due to a nonpayment of rent, the landlord must give a 10-day “notice to quit.” This notice to quit is a demand for payment by the landlord. Beginning on the day the notice is brought to the attention of the tenant, he or she has 10 days to pay their rent before the landlord is allowed to follow up with an eviction. The landlord cannot file for eviction until after the 10-day notice has been given and the tenant has failed to comply.
When a tenant remains on the premises after their lease or rental agreement has ended, they are known as a holdover tenant. As a landlord, you are not obligated to renew a lease with your tenant at the end of the current lease. If the landlord does not choose to renew the lease with their tenant, the tenant must then surrender possession of the property at the end of the current lease. Although a landlord has every right to not renew a lease, they are required to provide a termination notice prior to the end of the current lease. The criteria of this termination notice is listed below:
This notice of termination is also called an unconditional notice to quit, which says when the lease expires and states a deadline by which the tenant must vacate. If the tenant does not comply with the above notice, the landlord may proceed with the eviction process.
Violation of Lease
As a landlord, you have the legal right to evict your tenant if you find that they have violated or breached a specific condition of the lease. Such breaches may be that they have a pet even though the lease clearly states that pets are not allowed, or they have damaged property without making any reparations. Any willful or intentional damages made to the property are subject to a misdemeanor in the state of North Carolina. In a situation where a tenant has violated the lease, the landlord has no legal obligations to provide a notice before evicting the tenant. Unless the lease requires notice and an opportunity to cure, the landlord can file eviction papers upon learning of a violation.
Illegal Criminal Activity
For landlords looking to evict their tenant due to illegal criminal activity taking place on the premises, the state of North Carolina has an expedited eviction process.
Defense by Tenants
There are seven main defenses tenants may use to fight an eviction in North Carolina. While some of these defenses only relate to one or two of the reasons for eviction, most of them are applicable to all four reasons to evict a tenant.
Serving Eviction Papers in North Carolina
After providing the tenant with a required notice, the landlord may then file for the eviction process through either the small claims court or the district court. It is important that the summons and the complaint are filed in the county in which the rental property is located. A complaint is a legal document that states the reasons one party seeks legal action against another. A clerk will provide a form titled “complaint in summary ejectment.” When filling out this complaint, the landlord must list all tenants whose names appear on the lease or rental agreement. A summons is a legal document that notifies a defendant (the tenant) that an action has been commenced. The summons will state a date and time on which the tenant should appear at a specified location to answer the complaint.
Once the landlord has filled out all of the necessary paperwork, the county sheriff will serve the tenant with the summons and a copy of the complaint. After receiving these papers, the tenant may do one of two things: vacate the premises or fight the eviction at the eviction hearing. The tenant is not required to appear at the eviction hearing, however, it is highly recommended. If the tenant does not appear in court, it is known as a default judgment, meaning that the landlord automatically wins. After winning the eviction hearing or appeal, the landlord will then file for a “writ of possession,” which allows the landlord to forcibly remove the tenant from the premises. If the tenant remains on the property, the county sheriff will accompany the landlord and padlock the premises within seven days of receiving the writ of possession.
At Adkins Law, we believe in providing top-notch, quality legal services at affordable prices. If you need to speak with an attorney regarding a family law matter, traffic citation or issue, or for your estate planning needs, contact Adkins Law to arrange a consultation. Adkins Law has offices in Huntersville and Ballantyne for your convenience.
The majority of states hold landlords to strict guidelines as to the appropriate circumstances in which they must return security deposits. Landlords who violate these laws can be held to stiff penalties.
A security deposit is usually in the amount of one or two months' rent. It usually must be paid at the time that the Landlord and Tenant sign the lease. The landlord must place the funds in an escrow account and give the tenant any interest generated by such funds. Upon the termination of the lease, the landlord must return the security deposit to the tenant if no violations of the lease occurred. He or she may keep the security deposit or portion thereof for the amount of any damages, which can be proven, pursuant to the terms of the lease.
Basic “Wear and Tear” versus Excessive Damage
The general rule is that you are not responsible for normal wear and tear. For example, if the dishwasher must be replaced because it has simply worn out, that's the landlord's responsibility. See the bottom of this article for examples of repairs and damages that can and cannot be deducted from your security deposit.
If you or your guest cause damage by your unreasonable carelessness or deliberate misuse, however, you must pay for it. The cost of replacing the dining room carpet because you and your friends thought those pizza and BBQ sauce stains would magically disappear is probably on you. You must leave a rental unit at least as clean as it was when you moved in.
Because "normal wear and tear" can be interpreted in many different ways, disputes often arise. The bottom line is that the better you itemize and document the condition of your unit when you move in, the better case you'll have against a landlord who tries to gouge you on the way out.
Landlords are typically required to return security deposits within 14 to 30 days after you move out. The landlord must send, to your last known address, either:
Your entire deposit (plus interest, in some states and in some cities), or:
A written, itemized statement describing how the deposit was applied to back rent, cleaning, or repairs, plus the remainder of the deposit.
How To Get It Back
If your landlord fails to return your deposit when and how the law requires, you can sue the landlord in small claims court. If the landlord has intentionally and flagrantly violated the law, in some states, you can recover two or three times the amount of the deposit, plus attorneys' fees and other damages.
Ordinary Wear & Tear (Landlord’s Responsibility)
By Elspeth Crawford
In a perfect world, landlords and tenants can work together without issue, both generously doing their part to keep each other happy and not disturbing their neighbors.
In fact, lots of tenant-landlord relationships fit this description, but we've all heard horror stories about the exceptions. And laws that protect both parties have become so complex that understanding your rights can be like herding cats. Since landlord-tenant law varies by state, the key is knowing your rights -- preferably before you even sign your rental agreement. Understanding your state law and the terms of your lease are your best guarantees against future problems.
Common Renters' Rights
Although renters' rights vary by region, many are pretty predictable. Here's a sample of rights likely to be addressed in your state's landlord-tenant law:
Before you move in, tour the premises with your landlord, and note -- or better yet, photograph -- any existing damage. When you move out, if your landlord withholds part of your damage deposit, ask for an itemized list of charges and the reason for the charges. If there's a discrepancy between this list and the one you made before moving in, let the landlord know immediately. Keep copies of all correspondence with your landlord, as well as dated records of phone and in-person conversations.
If you have a dispute
If your landlord takes an action that is illegal in your state or neglects a legality, you probably have grounds for legal action, but consider court as a last resort. First make every effort to resolve the problem by talking with your landlord. This is the simplest and least expensive approach to mediating disputes.
If the problem continues, enlist the help of a neutral party or a mediator. Mediators are usually publicly funded and available free or at low cost. To find out whether mediators are available in your area, contact your mayor's or city manager's office and ask to talk with someone about housing disputes or landlord-tenant mediation.
If all else fails, you can take financial complaints to small claims court, provided your claim is under a specified amount. Before you take this step, be sure to look up local law regarding your responsibility for attorney fees. Most larger cities offer free or low-cost legal support for tenants in case of a property dispute. You can also contact your state bar association to ask about its lawyer referral program, or check with local service agencies to find out about inexpensive legal clinics.
Evicting a tenant can be difficult and confusing if you haven’t been through the process before. Even if you have previously evicted someone, there are plenty of headaches that come along with the eviction process. From start to finish the process typically takes about 30 days. An eviction may, however, take up to several months.
In order to institute a proceeding for summary ejectment, a tenant must have either:
1. Failed to surrender possession of the leased premises after the lease has expired, or
2. Failed to comply with the requirements of the lease and the lease allows for termination in such an event (ex. failure to pay rent or using drugs on premises).
Once a landlord determines that the tenant has done one of these things, the landlord must give written notice to the tenant that his or her right of possession has been terminated. Written notice is typically done by way of a letter sent by certified mail.
After notice has been given, the landlord may file the complaint for summary ejectment with the clerk. This consists of filling out a packet of paperwork that you can retrieve from the clerk. In Mecklenburg County, the current cost for filing the complaint is $96.00. There is also an additional $30.00 fee for each defendant the sheriff has to serve.
After the complaint has been filed, a court date will be set. The court date is typically between one to four weeks after the filing of the complaint. At the hearing, you must present your case to a magistrate. Depending on what you requested in your complaint, a ruling will be made on possession and rent that is past due.
If judgment is entered in favor of the landlord, the tenant has a 10-day period to appeal. If the tenant appeals, a new court date for the matter will be set in District Court. This can take as long as a few months. During this appeal period, the tenant is allowed to remain on the premises, but must continue to pay rent.
If the tenant does not appeal the judgment, or in the case of an unsuccessful appeal, the landlord may have the eviction enforced by filing a Writ of Possession with the court and having it served on the tenant. The sheriff will notify the tenant of the eviction date and ensure that the tenant is physically removed from the premises on that date.
If the tenant leaves personal property in the premises, the landlord must provide the tenant with written notice before the property can be removed or sold. The tenant is allowed a 10-day period to return and retrieve the property if he or she makes a request with the landlord. After this period has lapsed and the landlord has notified the tenant of his or her intentions to remove or sell the property, the tenant has 10-days to respond. If the tenant does not respond, the landlord may remove or sell the property. The proceeds of the sale may be used to reimburse the landlord for any expenses regarding the eviction proceeding and / or any unpaid rent.
If you need assistance in evicting a tenant or would like to schedule a consultation with an eviction attorney in Mecklenburg County, please contact Adkins Law. Adkins Law is located in Huntersville and primarily serves Huntersville, Cornelius, Davidson, Charlotte, and Mecklenburg County. Call (704) 274-5677 to arrange a free consultation.