A discussion about security deposits is sure to make any property manager roll their eyes and sigh out of frustration.
Security deposits exist as a sort of insurance policy for landlords and property managers. These funds protect against unpaid rent and fees as well as damages that aren't related to normal wear and tear.
At the end of the lease, the security deposit is what everyone has their eye on. Tenants generally think it's all coming back, and it often does. On the other hand, homeowners or landlords feel like the deposit should be used to bring the property back to the same condition is when the renters first occupied. This creates a lot of conflict for property managers.
The property manager usually ends up standing in the middle much like a referee and making judgment calls about what is and is not normal wear and tear. Much like a referee one side usually feels short changed. This is one example of potential headaches and litigation for property managers.
Mishandling these funds constitutes yet another potential disaster for the property manager. In Colorado, the real estate commission has strict rules about how security deposit funds are to be handled. Failure to follow these rules can lead to some painful consequences. Unfortunately, there are times when even the best property managers get blindsided by a security deposit issue.
Here's an in-depth look at The Good, Bad and the Ugly realities of Security Deposits in Colorado.
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