Now that you’ve found a new place to move to, there is plenty to be done before you actually shift into your new home. It’s an exciting time, you start planning everything from your finances to packers and movers and even the griha pravesh. But first, you need to break the news to your landlord, how do you tell them you won’t be staying there anymore? Will they take it well, or will they raise hell?
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Most landlords or house owners hate losing tenants, the main reason for this is that they will have to give back the hefty deposits they collected as collateral. The other is the fact they know their home will be unoccupied, and they will end up losing money. In order to save themselves from losing so much money, they normally withhold the deposit you paid them. So, how do you convince them to give it back?
What is Rental Deposit: A Comprehensive Guide
If you are a tenant in India, you would have surely heard the term “rental deposit” or “security deposit” from your landlord or broker. A rental deposit is a sum of money paid by the tenant to the landlord or broker as a security against damages to the rental property or non-payment of rent. Here is a comprehensive guide on everything you need to know about rental deposits.
What is a Security Deposit Meaning?
A security deposit is a sum of money paid by the tenant to the landlord or broker as a guarantee against damages or losses to the rental property, or to cover unpaid rent. The security deposit can be used by the landlord to repair any damages caused by the tenant or to cover any unpaid rent when the tenant vacates the property. The security deposit amount is usually equal to two or three months’ rent, and it is refundable at the end of the lease term.
Understanding the Security Deposit Laws in India
Security deposit laws in India are governed by the Rent Control Act of each state. In most states, landlords are allowed to collect a security deposit, which is usually equivalent to two or three months’ rent. The landlord is required to provide a receipt for the security deposit, and the amount must be mentioned in the rental agreement. The security deposit is refundable at the end of the lease term, provided there is no damage to the property or unpaid rent.
Is Security Deposit Refundable? What You Need to Know
Yes, a security deposit is refundable at the end of the lease term, provided there is no damage to the rental property or unpaid rent. The landlord is required to return the security deposit within a reasonable time frame, usually within one to two months from the end of the lease term. However, if there is any damage to the property or unpaid rent, the landlord can deduct the amount from the security deposit and return the balance amount.
Landlord Not Returning Security Deposit? What to Do
If the landlord is not returning the security deposit, the tenant can take legal action against the landlord. The tenant can send a legal notice to the landlord asking for the return of the security deposit. If the landlord still does not return the security deposit, the tenant can file a case in the civil court for the recovery of the security deposit.
Owner Not Returning Security Deposit India: Steps to Follow
If the owner is not returning the security deposit in India, the tenant can follow these steps:
- Send a legal notice to the owner asking for the return of the security deposit.
- If the owner still does not return the security deposit, file a case in the civil court for the recovery of the security deposit.
- Gather all the necessary documents, such as the rental agreement, receipt for the security deposit, and proof of damages to the rental property.
- Hire a lawyer to represent you in court.
Landlord Not Paying Deposit Back? Here’s What You Can Do
If the landlord is not paying the deposit back, the tenant can take the following steps:
- Send a legal notice to the landlord asking for the return of the security deposit.
- If the landlord still does not return the security deposit, file a case in the civil court for the recovery of the security deposit.
- Gather all the necessary documents, such as the rental agreement, receipt for the security deposit, and proof of damages to the rental property.
- Hire a lawyer to represent you in court.
Check your Rental Agreement:
The first rule of renting a home is getting a good rental agreement done before moving in. The rental agreement, if drafted well, will have a point about the deposit and the terms and conditions under which it will be refunded. If your case meets these terms and conditions, there is no reason why the owner should deny paying you this amount. If there is no violation of the rental agreement, you can also use this to plead your case in court, if the need arises.
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A good way to prove that you’re not violating the terms of the agreement and that you’re leaving the house in the same condition as when you moved in is with photographic evidence. Take walk-through pictures of the house (ideally) before you move in and even after when you’re moving out. A checklist is also very useful, this will have details of what was broken, or damaged at the time of moving in so that you don’t have to pay for it when you’re moving out. To get a Rental Agreement click here.
Leaving the house before you get your security deposit
Most tenants get tired of asking for their security deposit back and end up vacating their homes in hopes that they will get the money later. In this case, getting the security deposit back is much harder and will take much longer. You have a better shot at getting it when you’re still in possession of the home. If your Rental Agreement clearly states that the deposit will be given to you only after you vacate, this point will not apply to you. Although, in the case of the latter, you need to have photographic evidence that you left the house in good condition. Otherwise, damage post your move can be brought up to avoid paying you what is due.
Get the law involved while getting your Security Deposit
If talking to your landlord does not help, the next thing you can do is talk to a lawyer. He will help you frame a Legal Notice and send it to your landlord. If this still doesn’t work, try filing a civil suit in court for the recovery of this rental deposit sum. This normally would take years, depending on how busy the court is. Some cases get cleared within months, and some take more than 10 years, but if you are patient, the law will work in your favour if you have your documents and evidence in order.
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Read: Know Your Renting Rights with the Model Tenancy Act
Use the N.I. Act
The N.I Act or Negotiable Instruments Act has been in effect since 1881. This act was created to ensure promptitude and remedy against the defaulters of any negotiable instrument such as a promissory note, bill of exchange or cheque. To use this method, you need to deposit a cheque with the date that the landlord needs to make payment, when the cheque gets dishonoured and he fails to make payment, then files a complaint under section 138 of this N.I. act.
Planning Ahead with Clarity
When the landlord not returning the security deposit one of the best things you can do is follow some of the steps that can keep you as well as your landlord in check. For example, your landlord is legally mandated to give you a notice in case your tenancy is being ended, typically ranging for 30 days. You must always make a copy of such a notice, and return a receipt in return. Or when you intend to leave before your contract/lease period, you should always try and get a replacement tenant so that your security amount can be replenished quickly. In case the owner is not returning the security deposit, you will always need the proper documentation and even photos of the repair work done so that these don’t end up being issues in court (in case it happens).
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Never Confusing the Last Month’s Rent with the Deposit
You should never confuse the last month’s rent for a security deposit, and always mark a separate sum of money labelling as last month’s rent. The benefit of this is that in case the whole deposit amount is being held on to by the landlord, you can use this for your next month’s rent wherever you may be moving to next.
Knowing Your Entitlement
You should always be aware of the things you are entitled to including the timeline of the return of the deposit from the landlord, an itemised statement listing how the deposit amount has been used towards any repairs or cleaning etc, as well as a statement stating whatever is left of the deposit amount. Be sure to brush up on the regulations in your state before getting into a rental agreement.
Read: Know Your Renting Rights with the Model Tenancy Act
Following Up Regularly with the Landlord
In case you are not happy with the deductions made from your deposit, be sure to follow up with the landlord as per your legal contract, as you can also negotiate on it further to bring it down. For this, you must clearly lay out the reasons why deductions are high, as well as any relevant laws that may have been broken.
If none of these methods work, try asking nicely, publicly and repeatedly. With some luck, your owner might cave in and give you the money that is due. But we hope that you find good landlords who follow rules, all the best for your house search. Remember, to get a home without paying any brokerage, choose NoBroker and click below for more details.
FAQs
Q1. Why do landlords hold on to the deposit amount?
Ans- Most landlords or house owners hate losing tenants, the main reason for this is that they will have to give back the hefty deposits they collected as collateral. The other is the fact they know their home will be unoccupied, and they will end up losing money. In order to save themselves from losing so much money, they normally withhold the deposit you paid them.
Q2. Why is the rental agreement for getting the deposit amount back from the landlord?
Ans- The first rule of renting a home is getting a good rental agreement done before moving in. The rental agreement, if drafted well, will have a point about the deposit and the terms and conditions under which it will be refunded.
Q3. How do I prove I have not violated any terms of the deposit refund?
Ans- A good way to prove that you’re not violating the terms of the agreement and that you’re leaving the house in the same condition as when you moved in is with photographic evidence. Take walk-through pictures of the house (ideally) before you move in and even after when you’re moving out.
Q4. How do I take the law’s help to get the deposit amount refunded from the landlord?
Ans- If talking to your landlord does not help, the next thing you can do is talk to a lawyer. He will help you frame a Legal Notice and send it to your landlord. If this still doesn’t work, try filing a civil suit in court for the recovery of the security deposit from the landlord.
Q5. Is the landlord legally mandated to notify me in case my tenancy is being ended?
Ans- Your landlord is legally mandated to give you a notice in case your tenancy is being ended, typically ranging for 30 days.
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