Not sure how it works in your state, but in NJ and NYC you have to put the renters check into an interest baring account. Usually the bank sends you updates on your account and you have to claim the interest on your taxes meaning it's yours (baring something happens to your place). If this is the case simply contact the bank and ask how to go about removing it. If they won't help small claims court.

@Skankingmike:

That's assuming that the landlord was following the law. Since he ran into money problems and allowed a property to go into foreclosure, there's good chance he may have used that money to pay bills, hoping to buy some time.

First things first, do you have your lease document? The deposit is owed by the original landlord, not the bank that holds the house now. Unless they novated the lease, which it sounds like they did not.

That's who you'll have to sue.

Yes, it sucks. But go through the process. You'll be able to easily show that the landlord did not pay you back the deposit. You'll win the judgment. Then certify it for it to become a legal debt.* Then, when tax time comes around, send a 1099 to the landlord and declare the debt bad. You can then claim that as a capital loss. Its not the same as collecting cash, but its something at least. We went through this with my youngest son a few years ago.

*Before you do that, you need to check a few things. One, is the landlord now in bankruptcy (but was not at the time of the verdict). If that has changed, you'll need to contact the bankruptcy trustee to talk to them about all of this. It gets more complicated.

That being said, it might be a good idea to get a CPA or lawyer to sit down and explain this in more detail. Legal fees you can also tack onto the amount you're suing for in most places in the country.

[www.rentlaw.com]

cannot be denied a deposit. They have 3 weeks to return it.

and you can sue for 2x the deposit ammount.

have fun with 4k judgment on them

however you may have to sue your old landlord as he may have made off with it....

I like NJ laws better. I get a bank statement telling me where my money is.

Any thoughts besides small claims court?

This would be my response:

No, you had an opportunity to come up with a resolution in your reply. You did not. Your small claims paperwork is in process and will be mailed to you as soon as I have had it approved at the courthouse.

As I understand you may see this deadline as firm and final, and possibly rather sudden, along with it possibly undermining the sale of this home until the case is over, you may wish to have an emergency negotiation to resolve the matter. I will not have the paperwork completed until (date). You may visit my new residence at (addresss) between (times) on (dates) to discuss this. Be prepared to sign a resolution contract on your first visit and be prepared to pay the full amount owed in cash on your first visit, not by cheque or any other method. You will receive a signed receipt for your payment.

Sincerely,
(name)

This appears to be in San Jose, CA...?

The relevant laws and the CA Dept. of Consumer Affairs handbook concerning deposits are here, although I suspect our OP is familiar with these already. The DCA suggests small claims court.

But that whole weeping thing would be step one for me.

Have you considered arson?

@Skankingmike: In Massachusetts you are also supposed to do that with the renter's security check, but suffice it to say that I've only actually seen that handled in accordance with the law once in the 25 years I lived in that state.

@Etoiles: Just report any offender to the states board who handles those things.

if those are your appliances inside, wouldn't they be considered stolen now?

You should have stopped paying rent a long, long time ago.

@Skankingmike:

Definitely not the case in CA. In CA you provide the deposit directly to the landlord, who is responsible for giving it back to you at the end. That responsibility apparently passes to the new owner if there is a change in ownership.

@donjumpsuit: She certainly could have squatted there for a long time I'm sure. Its tough enough to kick a tenet out when you have all the proper paper work. I'm sure the bank would find it extremely difficult to do legally.

Check with the housing division of the municipal or county government to see if they have a tenants' affairs department or similar that can offer any guidance or assistance.

the laws are different from state-to-state regarding the OP's rights - it would be helpful in these stories to at least provide the state s/he resides in.

if it were me, i would file a small claims suit against the mortgage company for the security deposit as well as value of any goods you were unable to recover in the move (if any). that seems to be what the law allows according to the story, right?

I did some research and found out that new owners of the property would owe me my security deposit.

the new owner would be the bank (GMAC). bring citation of the law to support your claim.

@mac-phisto: also - no notice of eviction? it seems to me that might violate a law or two in a few states.

I've always considered a security deposit as lost money. I've gotten a few back, but I never plan on it. Not because I trash the house, but because they do need cleaning, carpet cleaning, and usually painting and minor repair and such after a move out. I view my deposit as payment for those services. Definitely not worth the headache of going to court and fighting for it.

@jgodsey: I could be wrong, but it sounds like the OP *might* have gotten her appliances back in that meeting with Armando at the house, but that was also when he informed her that he would not pay her the security deposit. I'm a little unsure, though...the OP mentions the appliances as the reason for the visit, but not whether they were retrieved...

@donjumpsuit: Maybe I misread it, but the person didn't know that the house was going into foreclosure before the note on the door. So it wouldn't make sense for them to stop paying rent.

@Skankingmike: Actually, according to the article you linked to:

"You can sue in small claims court for the deposit plus 2x the deposit in damages. The judge may award you damages if the landlord retained your deposit in bad faith."

So it sounds like he could get is $2200 deposit, plus $4400 in damages. If he notified the realtor and the bank about the law in a good faith attempt to collect, and both of them are refusing, then take them to court and it's a $6600 judgement. A $6600 judgement against a bank with nice deep pockets. Plus costs.

If the court won't let you sue the bank, then sue the landlord, get the same judgement. If he doesn't pay, then you can get it certified, turned in to a debt, and then send the landlord a 1099 and you get a $6600 tax write-off from the IRS. That won't get you the full $2200, but would get you pretty close.

@BZMedia: I can see having that mentality if it were a couple hundred bucks. But not over $2,000. If I didn't legally owe that, I'd be fighting for it.

@dangerp: ...and in this story we see a major reason why that NY law is a good idea.

@Adam Stewart: I forgot to say: Once the bank sees a small-claims action against them, they will likely settle. It's more expensive for them to fight it, especially if they can't win it. File it, serve them, and in a week or two you'll have a settlement check for the full $6600 from the bank.

I've read countless stories where someone takes a company to small-claims court, and as long as the amount is low enough, and it sounds like you have a semi-reasonable chance of winning, then they always settle.

The title went from the old owner to GMAC - it was never in the agent's name. Go after GMAC not the real estate agent. My understanding is that even in a foreclosure the new owner (GMAC) is responsible for the security deposit. You will likely win the judgement, possibly by default as GMAC is too big & bureaucratic to show up, but have trouble collecting. If they don't pay the judgement you can get warrant & the sheriff will go to their local office and confiscate office equipment to cover the amount owed.

@BZMedia: in some states it is illegal for them to keep the deposit for things that fall under "normal wear and tear" painting and carpet cleaning normally fall under those unless your lease is very short.

Alright, Renter. Our president signed a new law into play several weeks back that specifically protects renters in your situation. Did you have a "bonafide" lease/rental agreement? (ie=in writing)? Was that agreement signed before the complaint (the initial initiation of foreclosure action) was filed? The law now states that if it was and the home is acquired through a foreclosure action by a bank, and you can provide a written "bonafide" rental agreement, they are required to honor it through the remainder of the rental term. You will have to pay rent to them, of course. Now, if you don't meet these terms, there is now a 90 day window from the date of foreclosure until eviction before they can have a writ of eviction on you. However, if you voluntarily moved out on your own accord, they inspected and found the property vacant, and you are now trying to claim or retrieve the appliances in the home, you need to know that you are only entitle to anything not "hardwired" in the home. Meaning, you can have the refrigerater, washer dryer, microwave. Your claim to anything hardwired like a stove, water heater, dishwasher, etc... is going to have be validated by proof of ownership (a receipt or other marking or written proof that it was not part of the rental agreement) otherwise, it is assumed to be "permanently affixed" to the real property (thats the house) and you rightfully are going to have to go before a judge and argue and somehow proove it was yours.

My advice is to google the new law .... and know that when you voluntarily decided to move out (removing your personal items) you voided any assumption anyone could make that you intended on returning or disputing your rental rights with the new owner. You are basically now left to fight with the former owner for termination of contract. (small claims court would be my suggestion)

Too bad it wasn't sold at auction, you might have been able to just buy it at a nice discount!

@BZMedia: Repair of normal wear and tear is covered in your rent. The security deposit is for anything you do to the apartment beyond that. If you inherit the apartment clean, clean it before you leave to the same condition or better, and fix any damage. Then you deserve 100% of your security deposit back. The security is for serious damage, not normal wear and tear.

@Skankingmike:

You should double-check that law. Usually, such laws only apply to rental properties with more than X units, for example, an apartment complex. She was renting a house. It get's a bit more difficult in this case.

I wonder if renters shoulc start asking for credit reports from their prospective landlords?

I believe I'm renting an "illegal" apartment, and my plan is to trash the place if I don't get my deposit back. Not too much damage, just enough for the deposit to cover and make me feel better. Maybe a broken faucet, a few broken tiles or a missing refrigerator door (that refrigerator is ancient, I'm doing the new tenants a favor!) .

But they seem to be nice folks, I don't think they'll cheat us on the deposit.

Any chance of the former renter putting a lien against the property? That would seriously muck up any attempts to sell it, wouldn't it?

Doublecheck the laws on deposits. When our landlord was about to lose his house to foreclosure, I did a bit of research for Utah. Deposits are owed by the original landlord. When the property is foreclosed, the lease is canceled, and the tenant is out on the street w/ 30 days notice.

Also, in some cases, the renter can be sued for back rent in the foreclosure proceedings, so stopping paying rent isn't a great idea.

I was lucky to have a landlord who told me he was going into foreclosure. Before he was notified of default, I had him sign a letter of mutual agreement to terminate the lease, and he gave me my deposit in cash.

Good luck, OP.

Not sure you can do this in this situation, but can you file a lien against the property? Then they would not be able to sell the house until the lien is cleared.

IMO, the top 3 deadbeat professions:

1. Lawyer
2. Car Salesman
3. Realtor

@Tux the Penguin: OP claims CA law says the current owner owes the money. Which would mean the current owner has to pay it and go after the original landlord.

Of course it makes no sense, but if that is the law, that is the law.

@K-Bo: True enough. But I still never expect that money back, and I'm never disappointed. In addition to viewing it as wear-n-tear move out money, I also look at it as lease-opt-out money, which I have done before. If I decide I want to move before my lease is up, I move. And they can keep the deposit in return for my breaking the lease. I know most leases say they are also entitled to collect rent for every month of the lease that you're breaking, but that's only if they don't re-rent it, (they can't collect double rent on the same space with the lease still in place) which has never happened in my cases.

Anyway, whether it's legal or not for them to keep it for move out maintenance, it just doesn't matter to me. I don't look at the deposit as being owed to me, so I don't stress over it. If I get some of it back, great. If not, oh well. Besides, it's only a couple grand. If it was up around $7k or $8k deposit, then I might start getting twitchy.

Sounds a little fishy. Who was she paying rent to all this time? If she was in the house the month of June, who got that month's rent? If she wasn't paying rent for June or any other time, it would come out of her deposit. Nice that she expected them to hold up their end of things a few days so she could sell her washer and dryer. Unlike a regular sale of income property, the bank doesn't receive old rental deposits in an escrow. She needs to go to the old owner and sue them in small claims court. I find it interesting how she mentions the "cash for keys" program so it sounds to me like she is wanting to use this whole episode to her financial advantage.

Something to consider in this case also, if the renter wasn't served an eviction notice, and moved out on her own, (in anticipation of foreclosure) technically she broke her lease.

@katstermonster: they were retrieved but since the had to "illegally break the locks" to get in it voided her getting her security deposit back.

@tinmanx: How are you going to trash it AFTER you don't get your deposit back? You only know for sure they'll refuse if either you do trash it before hand or after you move out. Either way, you won't be in there.

@BZMedia: i did that with my last place. I was already unhappy with the dump and I knew my landlady was not going to easily give me my deposit back (she dicked my friend over with that when he moved out) so I didnt pay the last month. That last month rent went to my new place instead. And I left my apt in great condition.

@Corporate_guy: Where can you attach attorneys fees to a judgment? I do not know anywhere that allows you to sue for attorney's fees? You may be able to attach legal costs such as court fees but does anyone have a US citation to a place where you can add on attorney's fees?

@BZMedia: Seems your comfort point is higher than mine.

@sean98125: im all for it. We have to jump through hoops for them just to get a crappy apartment so if I have to pay all this money (1 month rent plus security which is sometimes almost 3k) I want to make sure that I am guaranteed a roof over my head during my lease (less any fires, building collapsing, acts of god).

@Matt Singerman: It's amazing what people will put their real names to.

@Adrienne Willis: Shouldn't breaking the locks be at most the price of repairing the door jamb? Not that that is even a legitimate expense, since they stole her property and locked her out.

@Xerloq: this is no longer valid with the national laws passed.

@Adrienne Willis: Exactly. I always leave it in good condition too. No point giving them a reason to come after you for more money. I trashed one apartment when I was 18, because I was a stupid kid, and ended up paying an extra 6 months worth of the rent amount just to pay for the damages, plus the deposit. (and didn't get to live there in the meantime). Needless to say, I learned my lesson.