Do tenant damages have you worried about your rental property cash flow? Wondering if you’ll need a keep a sample letter to tenant for damages on hand?
As long as you’ve taken the proper precautions, you can rest easy knowing you’re protected. Landlords are legally allowed to collect security deposits in all 50 states to cover damages aside from normal wear and tear.
If you plan on keeping part or all of a tenant’s security deposit, you must provide the appropriate notification. Otherwise, you may risk waiving your right to withhold funds.
Luckily, properly notifying tenants of funds withheld for damages doesn’t have to be difficult. Follow the steps below and you’ll be covered in no time.
Additionally, we’ve provided you with a sample letter to tenant for damages that you can use to create & send your own.
1. Document the Property’s Condition Ahead of Time
Before a new tenant moves in, remember to document your property’s condition. This includes taking photographic evidence of as much of your property as you can. Should a damages case go to court, you want proof that the tenant caused damage beyond reasonable wear and tear.
It’s a good idea to document the property’s condition at:
- Quarterly inspections
Using an inspection checklist can help you document your property’s condition thoroughly. This helps you establish a timeline so whoever caused damages can be held accountable.
2. Review Your Lease and the Law
Make sure you are legally covered. Your lease should detail what damages tenants can be held responsible for, and to what degree. Having a tenant’s signature here will remove any question of who is financially responsible for damages.
Laws vary from state to state regarding how much time landlords have to notify tenants of withheld security deposit funds. Generally, you may have anywhere from 14-60 days to notify tenants. Check with your state laws. If you do not notify tenants within the appropriate timeframe, you may risk waving your right to the funds.
3. Check Your Tenant’s Renters Insurance
Landlords can require tenants to extend additional insured coverage to them under the tenant’s renters insurance policy. This can help protect the landlord in case of damage. Not every damage is covered, though, so have your tenant check their policy. If their policy covers the damage or extends coverage to the landlord in the form of a payout, ask your tenant to start a damage claim.
4. Document the Specific Damages
Damages should be documented specifically enough that a neutral third party can confidently understand what is being charged for. This type of documentation could look like:
- Hole in living room’s north-facing wall, about three inches in diameter.
- Four missing blind slats from the master bedroom’s window.
- Five-inch crack in guest bathroom’s tub.
Try to document so there is no question what damages you are holding the tenant liable for. Remember to take photos or videos to accompany your written documentation.
5. Itemize Repair Costs
Either get quotes for the necessary repairs or keep receipts if you’ve already made the repairs. That way if a tenant disputes repair costs, you will have an itemized list from professionals showing how much the damages actually cost.
Remember you only have a certain amount of time to notify the tenant of withheld funds, so try to contact any repairmen as soon as possible.
6. Notify Your Tenant
When you notify your tenant of withheld security deposit funds, remember to include:
- The property’s address
- The date
- Your name (or your property manager’s name)
- How much money you are withholding
- A list of damages and their costs
Sample Letter to Tenant for Damages
You can create your own sample letter, or you can download the sample letter to tenant for damages we’ve provided below.
When to Write a Demand Letter
If the cost of damages exceeds the tenant’s security deposit, you may need to write a demand letter for the additional funds. Format your letter similarly to how you’d format the letter for damages. Be sure to include how much money you’re demanding to cover repairs and the deadline for receiving funds.
When requesting additional funds, it is especially important to justify repair costs by attaching professional quotes or receipts. Again, this will discourage tenants from disputing the price in court.
Avoid Tenants Who Cause Damage
One of the best ways to protect yourself against damages is choosing the right tenants. Wondering how to avoid tenants who may cause damage? Finding tenants who will be responsible often comes down to prescreening and background checks.
- Prescreening: You can do this through a phone call or use RentRedi’s built-in prequalification template.
- Credit check: Look for credit scores that are 650+ to find tenants likely to pay rent on time.
- Background check: RentRedi partners with TransUnion to provide a background check covering credit, criminal, and eviction history.
Property damages can feel scary, but following the right steps can give you peace of mind. RentRedi can help you manage tenant screening, applications, communication, and more so you can keep your rental property running in top condition.
Jen Watson is a finance and real estate writer with Siege Media. She has worked with clients like Quicken Loans, EquityNet, Homebuyer, and more to bring consumers quality information around financial topics.