You may have had a leasing agent offer you a SureDeposit in lieu of a traditional security deposit. Many renters are confused by just what a SureDeposit is, and what the benefits and risks are associated with taking this option. We have decided to use this opportunity to take mystery out of SureDeposits so that renters like yourself can make an informed decision.
What is a SureDeposit?
In a traditional deposit, money is paid by the renter to the landlord to ensure that if they damage the apartment or break their lease the landlord has a pool of money from which to pay for those damages or collect all or a portion of the unpaid rent. Traditional deposits are typically refundable given no damage or outstanding rent, and can range anywhere from a few hundred dollars to 2x monthly rent depending on many factors like the age and quality of the apartment, whether you are bringing pets, your qualifying situation, etc.
SureDeposit is marketed as a way to secure your apartment with a lot of less out-of-pocket expense. With a SureDeposit you will pay a much smaller amount than the traditional deposit in the form of a non-refundable fee. What this fee does is provide the apartment with a guarantee that should you leave your apartment with damage or unpaid rent the SureDeposit provider will pay the difference up to the agreed upon amount, like a guarantor.
So lower upfront cost and the SureDeposit provider pays for any damage. Great, right? Well…
What SureDeposit is not is a way to get out of paying for damage to your apartment or unpaid rent. All your non-refundable fee does is assure the property they will get compensated for damage or unpaid rent. However, if the property has to claim on the SureDeposit, you are then legally obligated to repay the SureDeposit provider for the amount they had to pay the property.
Who offers them?
SureDeposit is still a very new alternative and although it is growing with popularity not all apartment communities have adopted this method. There are several companies that issue SureDeposit, Assurant Specialty Property being one of the most recognized. Not all rental properties accept SureDeposit, and if they do, they will likely work with specific providers. Make sure to check with your leasing agent for a list of approved companies.
What is all the confusion?
If you read about SureDeposit online you probably heard from many disgruntled renters who felt either deceived or confused as to what they had signed up for. Many renters take this option thinking that SureDeposit is like an insurance policy where they pay a little upfront and when they leave SureDeposit will cover any damage done to their unit or any unpaid rent. Not the case at all! If your landlord is left having to submit a claim on your behalf you will have to pay it back or be subject to legal ramifications.
Who is it good for?
SureDeposit may be a good alternative for people who would struggle to cover the deposit, but are SURE they will stay in good standing with their apartment and leave it as pristine as it was when they moved in. It is especially beneficial if these renters also plan to rent at the same apartment long term since the SureDeposit fee is only paid once and is good for the life of your tenancy. In these cases, you will have paid a small fee to avoid having a large portion of your money tied up.
Who is it bad for?
If you have a history of having all or a portion of your deposit not returned, SureDeposit is probably not a good option for you. Why? Because you will pay the non-refundable SureDeposit fee, and you will still be responsible for paying for any damages to the apartment either directly to your landlord or to the providers of your SureDeposit if they pay a claim on your behalf. If you had paid the traditional deposit you would only be liable for the damages and would not be out the non-refundable fee too.
Keep in mind….
Even if you take the option of the SureDeposit, at the end of your lease your landlord will assess any damages that would traditionally be taken out of your deposit. You will have the option to settle with the community directly and often this your opportunity to dispute the landlords assessment
Still not sure if SureDeposit is right for you? Be sure to check out some of our favorite sites for more information.
We understand that renting an apartment can be a financially draining experience and move-in fees can add up. Today SureDeposits offer renters an option to replace those large security deposits which can help to lower the stress and chaos that comes with moving. If you lack the funds to secure an apartment an apartment finder can help guide you towards apartment communities with more affordable security deposits or one that accept SureDeposit.