Patty Manzi’s Tri-Valley Real Estate Blog

Here in the Pleasanton Real Estate market a lot of people are in a very sticky predicament.  They have lost their home to foreclosure, short-sale, bankruptcy, or a combination of those scenarios.  They are now faced with a dilemma of not only trying to find a home to rent, but trying to do that with a very messed up credit.  Some of the problems on the credit report could range from late payments, to collections, to unpaid credit cards,unpaid mortages and more. 

Typically when a person completes an application to rent a home they pay a ’screening fee’ and authorize the landlord or a property management company to run a credit check.  Some management companies also check for previous rental history (eviction) and criminal background as well.  But, just because someone has less than stellar credit does not mean they will not be accepted as a renter.  It really depends on the circumstances. 

If a credit report shows that a person has a long history of consistently being late in paying all of  their bills, are over extended on their credit lines,  has multiple unpaid accounts or collections, and barely makes enough income to cover their rent, they will probably not be an acceptable rental candidate.  On the other hand if the credit report shows a strong consistent payment history on most of their debts, unpaid or late items can be attributed to an isolated time frame during which a foreclosure or job loss occurred, the person can show verification of income, and they can show their income to be 2 to 3 times the amount of their rent, then they are in a better position to be considered an acceptable candidate. 

Keep in mind it is up to the discretion of the landlord or property manager to make the final decision, but most of the time landlords or managers are willing to work with prospective tenants on these issues.  It is always best to be open and honest about these potential credit issues before the rental application is submitted.  Explaining the situation to the landlord/manager and having the discussion up front can help the prospective tenant determine their options before they get too far along in the application process. 

In some cases the landlord or manager could require additional security deposits, but the deposits are limited to the amounts allowable by law (in California that amount is 2 times the monthly rent).

The most common disagreement between tenants and landlords is over the refund of the security deposit after a tenant has vacated a rental/leased unit.  California law specifies procedures that the landlord must follow for refunding, using, and accounting for the tenants’ security deposit. 

Under California law the landlord is allowed to use a tenants’ security deposit for the following  four (4) purposes:

1. For unpaid rent
2. For cleaning the rental unit when the tenant moves out, BUT ONLY to bring the unit up to the level of cleanliness the unit was when the tenant first moved in
3. For repair of damages, other than normal wear and tear, that is caused by the tenant or the tenant’s guests
4. For the cost of restoring or replacing furniture, furnishings, or other personal property items (including keys), that were included with the original rental/lease agreement, other than normal wear and tear.

A landlord can withhold only the amounts that are reasonably necessary for these purposes.  The security deposit cannot be used for making repairs on things that existed before the tenant moved in, or for conditions caused by normal wear and tear.  

A rental agreement or lease can NEVER state that a security deposit in non-refundable.

Under California Law, 21 calendar days or less from day you move out, the landlord must do the following:

1. Send you a full refund of your security deposit.
2. Mail or personally deliver an itemized statement that lists the amounts of any deductions from your deposit, the reason for the deductions, along with a refund of any amounts not deducted.   The landlord must also send you copies of receipts for any charges the landlord personally incurred to repair or clean the rental/leased unit.

The landlord must send the itemized statement, copies of invoices or receipts, and any estimates to you at the forwarding address that you provide.  If you do not provide a forwarding address, the landlord is obligated to send the documents to the address of the rental unit you moved out of.    The landlord is also not required to send copies of any documentation if the repairs/cleaning costs are less than $126.

If you have a dipute about your refund, you must contact the landlord IMMEDIATELY by phone or e-mail, but you should always follow this up with a formal letter.  There are many agencies you can contact for assistance.  For more information contact the California Department of Consumer Affairs, www.dca.ca.gov.