I live off of a stock market portfolio. Investments. Because I am 'unemployed' to them (Despite showing 1099s, tax returns, etc), they want 2x the security deposit. They've seen my portfolio and know that I can afford it, it makes me feel uncomfortable.
Needless to say, it's around $2,950 for rent (Being split 3 ways with family members) and now they want double that just in the form of a deposit.
I kindly asked "I don't understand? Why not put it to another month's worth of rent? How could I possibly cause $6,000 worth of damage!?".
They're reluctant to budge and kind of said "We can just move onto the next person".
I am talking about ethics here. They know I have a significant sum of money saved but this really seems excessive and like an unnecessary barrier. For whatever reason, allocating that money to an additional month's worth of rent up front want not what they wanted.
What should I do in the circumstance? This is in PA, I understand it's legal, but I have no record, criminal history. Sitting on $6,000 seems insane. We've lived in my last place for 7 years, never missed a payment of rent. I feel like something is off about this.
Landlord wants 2x security deposit. I am concerned and would like advice.
byu/No_Departure7494 inRealEstate
Posted by No_Departure7494
29 Comments
What state are you in? Some states (CA for example) set legal limits on deposit amounts.
Counter with offering to pay 12 months rent in advance. At minimum, 6 months in advance.
They’re asking for double deposit because you’re a high risk, especially if the market does tank with the war dragging on.
Then find another place. Their house their call, your money your option.
Probably a policy because your lack of a W2. Very common. I was friends with a girl from Poland and when she tried to apply for an apartment they wanted a security deposit and for her to pay 12 months of rent in advance. So it could be worse.
Blah, Blah, Blah. They can rent to whoever they want. If you dont like the terms, then move on.
No amount of whining on social media will change that fact.
if you are sitting on that much just buy a place
It’s their house and they see an elevated risk for some reason with your application and/or financials. If you aren’t comfortable paying 2x deposit, which although not the norm definitely isn’t “unethical” by any means, then you should look for another place.
ETA::
>How could I possibly cause $6,000 worth of damage!?”.
Take a look at r/Landlord sometime. $6k is nothing quite honestly.
that seems perfectly reasonable? a lot of people in your situation prepay the entire lease term (when it is legal to do so)
2x is a bit much, but depends on location.
In SF region they take 1 month and that’s a lot of money. If it’s LCOL I can see them justify 2 months.
Either way there’s supply crunch everywhere. So landlords hold more leverage.
They’re reluctant to budge and kind of said “We can just move onto the next person”.
Seems you are both in agreement. Good luck in the rental search.
You’re unemployed and living off an stock market portfolio whose value could ostensibly go to 0 on any given day. There’s a chance you could end up unable to pay your rent. They want to mitigate their risk. Alternatively, the other 2 family members could make enough money through their employment that their income satisfies whatever their requirements the landlord has (usually they say 3x the rent). There is nothing off about this. You could find another place that’s not as risk adverse.
Honestly? I’d be very hesitant to take a tenant that lives off a portfolio and does not work. Why? Because an employed tenant can lose employment and then get another job, but one living off a portfolio cannot get a new portfolio should the market not perform or even crash.
If you like the place pay the additional deposit. If it’s not worth all that to you then keep looking, but don’t be surprised if other landlords also want larger deposits or a year up front.
Op has posted a few times FYI. Doesn’t seem to meet what most landlords want for qualifying. OP wants an exception to qualifying normally because they have an unusual situation. There was a third post before these that seems to have been deleted as well.
OP: given your post history and difficulty finding a landlord willing to rent to you, I’d pay the deposit. You can ask they put it in a higher interest bearing account so you are paid back the interest when you move out.
https://www.reddit.com/r/realtors/comments/1s5rnz5/common_to_be_ghosted_as_a_tenant_looking_to_rent/
https://www.reddit.com/r/RealEstate/comments/1s3fhj5/being_treated_like_a_pariah_when_applying_for/
A handful of years ago 2 times rent for security deposit was very common when I was apartment hunting.
It’s not about “doing 6 months of damage”
It’s weeding out people who don’t have significant savings. People who have savings, and can tie up $6k, are far far more likely to pay rent.
You either pay it or find another place
Idk deposit and last month’s rent often become the same thing in a dispute. Collecting $6,000 on a 3000 rent is not crazy at all.
Just to be certain, are they specifically asking for 2 months security deposit, or first and last months rent? And are they certain which they are asking for? These are two different things and people often conflate them.
“How could I possibly cause $6,000 worth of damage!?”
You can cause $50k worth of damage very quickly if you are of a mind.
In some states they can’t do this
I have seen 2 months security before, not unheard of. Another user suggested offering 6 months or a year paid upfront but personally I do not like that. Unless it is going into an escrow, which protects you as well as them, you would have to fight to get that money back if there is an issue with the unit that causes you to ‘break’ the lease and move out early. Even if you are in the right that money is gone and now you have to get it back. Don’t like that.
Does your state require them to pay interest on security deposits? Not all states do but some are required if you they hold it longer than 6 months I believe.
It’s not about causing 6k worth of damage. It’s a worry that you won’t be able to pay and they’ll have to evict you, which costs far more than 6k in legal fees & lost occupancy time.
> They know I have a significant sum of money saved
No you don’t. You have illiquid assets that could be worthless *tomorrow* to say nothing about every future date in which rent is due. If you had a “significant sum of money saved’ it’d be in your checking account.
Personally, even that wouldn’t be enough. I only consider numbers the on the W-2s as income.
I don’t think legally they can use security for rent anyway? So yeah probably best to move on. Do you regularly transfer a monthly sum into your account for your bills including housing expense? I think I would rather show the ongoing transfer (you can filter and print a report to show like 24 consecutive transfer of 4k each month or whatever your numbers are (for the next place)
Rental relationships don’t get better than the initial negotiation.
Go find another place.
It isn’t just a deposit against damage. It’s also a hedge against you not paying rent. Right or wrong, no job is seen as a risk. For example, you probably lost tens or even hundreds of thousands last months. Are you always willing to sell your stock at a loss to pay rent? Even if you have a balance you may not be fully liquid, or major tax downsides to selling make you risky to not pay.
Just pay the 3k extra or move on. But you’ll find similar with any LL.
Place the security deposit isn’t that uncommon in some areas. You are “high risk”. And it is very possible to cause $6000 in damage. Their house they call. Rented or don’t.
In most places they are required to pay a significant interest rate on the deposit.
In most places they are required to pay a significant interest rate on the deposit.
You pay the deposit or find another place.
Pay the deposit and move in. Or, find another place and move there.