Settling Deposit Disputes


With more than 500 properties in the inventory of rentals we manage, there are routinely a minimum of 6 to 10 tenant move-outs and deposit disbursements to be dealt with each month. It is a lot of work, and coordination of the work is critical between our maintenance staff and the vendors who help us.

Be that as it may however, the worst part of my learning experience as a property manager is the handling of the deposit disputes that inevitably result from the damages we find and for which we charge. Granted, some tenants are exemplary and leave the houses in excellent condition, but more often than not, there will always be deductions we must take from security deposits.

If you have ever had a deposit dispute, you know that the conversation can quickly turn into a heated debate or argument. Now, I like to be right as much as the next person, but I have learned that forcing the position of “being right”, even though you may be, is not the best way to settle a dispute.

What is the answer in settling a dispute? Here are 4 approaches or attitudes that have worked for me:

  • Put yourself in the position of the tenant. This will cause you to immediately turn the conversation to empathetically understand why they are making the challenge. It will move you away from a defensive posture.
  • Leave self at the door. A deposit dispute is not to be taken as a personal attack. It’s simply an opportunity to hone your skills in settling conflict as amicably as possible.
  • When the meeting is over, try to be sure the meeting is actually over. An unsettled deposit dispute can cause your name to go out to the Better Business Bureau or a social critic, thus causing you to spend even more time answering questions.
  • Be open to the possibility that you may be wrong. I have found our company to be wrong in deposit disputes. As good as we think we are, sometimes we must give money back. A good reputation is worth more than silver and gold.

As painful as deposit disputes can be, it is one of the critical parts of this business that must be addressed in the most professional manner possible. The best ultimate defense, if conversation in dispute does not work, is to have each house documented with digital photos or videos, with inspection reports. Have a good lease in place and do the right thing every time. You’ll be okay.

Until next time,


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