How To Calculate Interest On Security Rent Deposits ?

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How To Calculate Interest On Security Rent Deposits ?


Apartment Listing  

A security deposit has to be paid by the tenant to the landowner in case of a lease agreement. The rate for security deposits varies from one state to the other. In some cases, if the tenant has been found guilty of causing extensive damages to the landlord’s property, the owner can deduct money from the security deposit before repaying the money back to the tenant when he/she decides to vacate the place. The landlord can use the security deposit if the tenant has failed to pay the rent on time or has refused to the pay the rent altogether.

However, most tenants use the deposit to pay the last month’s rent before shifting out. It is important to understand that these deposits are not really meant for paying your last month’s rent. In many cases, if you go ahead and do so without informing the landlord in advance, you would be charged extra for paying the rent late. The amount of interest added on security deposits if often minimal. The rates are governed by State laws and can change every year.

When you are paying security deposit to your landlord, always deposit the money in the form of check or money order. As with any other document, having a duplicate copy of the original is essential. Numerous states have laws that order the landlord to give a written statement about the security deposit. A simple interest method is adopted to calculate the amount you have to pay. The general formula is: principal (the amount of money) x Interest rate.

When you plan to vacate, you should send a “Demand letter” to your landlord asking for the money to be paid back.

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How To Calculate Interest On Security Rent Deposits ?

 
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Renting Laws :

How-Much-Are-Landlords-Allowed-To-Charge-For-Security-Deposits      The amount of security deposit a landlord can collect from a tenant varies from one state to the other. Different states have different rules and laws so understanding the basics is important. You have to pay a security deposit to assure the landlord that you will be paying your rent on time and ensure that the property will be maintained in a good condition. More..



 
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How To Calculate Interest On Security Rent Deposits ?