[FrancesA]

We have rented a Townhouse for 11 or so years , it is privately owned by a woman out of state in Ohio, the townhouse is in pa. The man we rented it from no longer does the repairs or rent collecting, it was taken over by a realty company about 3/4 yrs ago.

We paid a months rent security deposit plus a half months rent for having animals. Now the place is sold as of Friday the 1st of February. The realty place told us once before they have no idea about the deposits we made when we first moved in. Now with it being sold I asked again about the deposits, and the woman said all would be transferred to new owner who we would pay rent too. We will be moving out in July , so I would like to know who is responsible for our deposits.

In Pa I understood that after two yrs the money was to be put into an interest bearing account. We were legally supposed to be told what bank and such it was in etc. What are our options here? Should not the realty company have made sure to have the deposit money information and made sure we received that info?

This is about a thousand dollars that should have been in escrow gaining interest in Pa. Do I insist the new owners be responsible for this, since the realty company said that they will forward all this information to the buyers. I want to make sure we receive all our due monies back.

[twinkiedooter]

Your scenerio is rather complicated but in essence unless everyone kept scrupulous records every one is going to feign "I don't have the secutiry deposit money".

If the contract for the sale of the propertly itemized the security deposit you paid, then the new owner would be responsible for returning it. The part about being in an interest bearing account will come out in the sale documents. Keep after the realty company on this or you will have to see someone in small claims court to get it returned to you.

[FrancesA]

We have this years lease which states the security deposit was paid... but we have no information of where it is .

After living here for 13 years( I had to try and recall when we moved in)... I would think the interest would be a tidy sum.

Since it is Pa it must be put into an escrow account after two years, and on third year we were to receive interest minus 1%.. we have nothing. Not even landlords address or the bank or account number. But since the lease states what we gave as security deposit that would hold up in court.

Thanks for the help I appreciate it.

[twinkiedooter]

Yes it sure would. Guard that lease like it's gold... as it IS gold.

[Fr_Chuck]

The new owner will be resonsible, you may wish to inform them of this, so they get it at closing, What happens at closing, is your deposit is given as a credit on the closing statement normally, although the actual account should be transfer, but often it is not, but only a credit given on the closing document.

But the new buyer can be held liable for it. I would write a formal letter showign all the amounts and the expected or est interest, and send this to the current owner, the real estate agent doing the sale and the buyer, so it is all out in the open.

[FrancesA]

My understanding is that it will transfer to the new owner. The thing is I have no idea if it was indeed put in escrow at all. It legally should have been after two years, and that means it should have been in escrow for the last 11 years.

I will be calling the ones who have our lease now and request all the information including current owners address. I need to find out where the money is and the account number. I don't have information on new owner yet, that will be given to me inMarch when the paperwork is done.

I have no idea at all how much is in account, I know the interest rate was as high as 3.1 % in 97 and now as low as 1.5 % in 08. We never received any of the interest money as legally we were to get it minus 1 % starting the 3rd year. So I just want to make sure I know if the money was put in escrow in the first place.

Like I said we have the exact dollar amount written in our most current lease, the rent always increased but of sourse the security didn't.

Thanks so much for your reply.

[excon]

Hello Frances:

I wouldn't worry about whether they put your money in escrow. They probably didn't. So what? Yes, I know that's a violation, but if they give you your deposit back PLUS interest when you vacate, what difference does it make where they kept the money?

I would do what the Padre suggested. Let them figure out what to do about it.

excon

[ScottGem]

Your situation is not complicated at all. The only question I have is whether the law you refer to applies to single unit landlords. Sometimes, rules such as that only apply to landlords that have multiple units.

Assuming the law does apply, then you need to inform the buyer prior to the closing about your concern in this issue. This way the buyer can make sure the money is transferred at closing or held out of the money paid to the current owner. I would make sure you figure out what the money would be worth now. Talk to your banker about that.

I also agree with excon, you don't need to worry where the money is now, only that the new owner will be responsible for returning it to you when you move.

[FrancesA]

Ok I talked to the property management bookkeeper today.. althought they have it on file that I paid the deposit( 322 was pet deposit) so 645 is what my security deposit was. They stated they don't pay interest on said security deposits and had not done so in 4 or so years. I told them that this was to be in escrow now for as long as 10 years and if they are going to transfer the funds to new owner should it not include the interest as stated by law.

They will be getting back to me since they aren't sure how to handle this. I asked her since law states it should have been in escrow in interest bearing account and they never had it, should I not receive the entire amount . She replied that since interest was so low it was just a matter of a few dollars so they never do interest bearing accounts. I said to her, since you haven't had the account yourself then it should have been in an escrow account somewhere and the landlord was responsible.

Thanks so much for the help, it was really helpful to explain what my issue was and to have some feedback.

[ScottGem]

Did you double check whether the law applies to your landlord?

[FrancesA]

Yes it's a residential townhouse, and she was required to put into escrow after two years and to pay us the interest on 3rd year, which was never done. They have to clear this up so new owner can refund me exact amount including interest. I understand since interest has only been 1.5% in last 4 or so years it is why it was never sent but the property management now never received the escrow account when they took it over from another company in 2004.

So they have to find out what todo. The also stated they could not give me the information on what bank or account number because it's a corporation, so I reminded them that they said they never had the escrow account so I should be given the information once they do find out who has the money.

[ScottGem]

Ok, As is often the case, small landlords are not aware of what they are required to do. So they don't do it. The important thing here is that the buyer is aware that you will be entitiled to your security when you vacate (subject to a walk through etc.). This way they can deal with it as part of closing.

[FrancesA]

New owner is taking the place as is, which is real good shape for not many repairs being done... just normal wear and tear on a 22 yr old townhouse, rug is the original.. never was replaced as they had promised. My concern now is the original landlord if she didn't not put money in escrow, we will be deprived of ten yrs worth of interest... so I need to wait and see how the newer manager deals with this before the transfer of title/deed..

[ScottGem]

Now you haven't been listening. As long as the new owner is informed of the deposit issue prior to the closing then it doesn't matter whether the previous owner hands over any money or money with interest or what. If they are aware and do not make arrangements at closng to have the security deposit handed over to them,then that's just tough on them. Once they are notified of the issue, it's their responsibility to take care of it. So when you move they have no excuse for not having the money. So the only thing you need is to make sure they are aware and you can prove they were aware.