Landlords did you know that you are not allowed to co-mingle your rental income with your security deposits. In the state of Florida, landlords must keep funds given to them by a tenant as a security deposit in a separate account apart from any other funds.
The landlord must do one of the following with the funds given by the tenant as security deposit.
- The landlord may hold the total amount of the security deposit in a separate non-interest bearing account in a Florida Bank for the benefit of the tenant(s).
- The landlord may hold the total amount of the security deposit in a separate interest-bearing account in a Florida Bank for the benefit of the tenant(s). The tenant shall receive and collect interest in the amount of at least 75% of the annualized average interest rate payable on such account or interest rate of 5 percent per year, simple interest, whichever the landlord chooses.
- The landlord may also post a surety bond, executed by the landlord as principal and a surety company authorized and licensed to do business in the state as surety, with the clerk of the circuit court in the county in which the dwelling unit is located in the total amount of the security deposits and advance rent he or she holds on behalf of the tenants or $50,000, whichever is less. There’s more to this one, so be sure to review the Florida Statute that discusses it – 2013 Florida Statute, Title VI, Ch 83.49.
One thing we must remember that these funds are not the landlords until earned. Depending upon your lease the security deposit may help to cure physical damages to the property caused by the tenant. It may also be used, again depending upon the lease, to cover late fees or past due rents.