Topic: Sure Deposit

Is anybody out there using Sure Deposit? Your thoughts? Thanks :)

Great question - I am curious about this product as well and look forward to the responses.

Yes, we use it and it is great. It is a cheaper way for the resident to move in, which they like, and it is easier to collect on them when they move out. An $87.50 non-refundable Sure Deposit is like a $500 refundable deposit. When you give residnets a choice most everyone goes for the cheaper non-refundable deposit. Also, everytime you increase the deposit by $43.75 it increases the bond by $250.00. Therefore, it someone is a little iffy and you would like to get a larger deposit you could ask for a $131.25 Sure deposit which is a bond for $750.00 or a $175.00 Sure Deposit for a bond worth $1000!

Applicants who know that they may not have the best credit are very grateful to only have to pay $175.00 when other complexes would ask for one month's deposit.

It looks like RealPage also offers a product called DepositFree through Leasing Desk. If I understand this correctly, the company (DepositFree or Sure Deposit) pays the apartment community for any damages reported after the resident moves out? And collections would then be 100% for move-out charges?

Where can I find information about this Sure Deposit program you are talking about? Thanks!

www.suredeposit.com

It has been many, many years since I've used Sure Deposit, however what I remember was that it didn't always hold up to our expectations. Yes, the resident can move in with a smaller non-refundable fee rather than a large deposit and that fee purchases them a larger bond through the company. If they move out and owe damages, Sure Deposit would then pay you up to the amount of the bond and then go after the resident for repayment of the bond plus any additional amount due. A plus side is that it shows up on their credit as a collection from an insurance company, which is typically easier to collect on than other types of collections. That all sounds great, but there was a big downside that I remember. Each fee that is paid is put into a pool that the bonds are drawn from. If you are continually drawing funds from the pool of fees, it could run out very quickly. Once this happens, there is no "bond" to cover the repayment of what a former resident owes until you collect more fees to increase your pool.

Again, it has been many years since I've used this service and my recollection could be off or their systems may have changed. It could definitely help leasing efforts if you typically require high deposits, but I recommend that you really do your homework before you sign up.

Thank you for your interest in SureDeposit.

If you would like to learn more about our program or have any specific questions, our president, Rich Schreiber, would be more than happy to assist you.

He can be reached via email at This email address is being protected from spambots. You need JavaScript enabled to view it., or via telephone at (301) 656-6142.

Best Regards,
Sage Shiraishi
Operations Manager
SureDeposit

I love sure deposit. Its only good if u have alot of vacants or a heavy turnover.

It sounds interesting, but nonrefundable deposits are a no-no in California. As a resident though I'd for sure love to pay a smaller deposit - at least it's a known quantity that I'm not going to recover and I can plan for it.

I love SureDeposit for the customer. It makes is easy for prospects to move in! From an owners side---I am not so sure. It is really like a self funded insurance policy.

Sara,
Nonrefundable deposits paid to a landlord and utilized as a mandatory requirement of a lease are indeed a no-no in California.
The payment to SureDeposit is not a deposit (it is a premium payment) , it is not paid to a landlord (the premium goes directly to the insurance company), and it should always be presented as an option.
We are currently offered at more than 400 communities in California.
Please click here www.suredeposit.com/clients/presscontent...alOwnerSDArticle.pdf for more info on using surety bonds in California, from a recent column by Ted Kimball, Esq. of the firm of Kimball, Tirey & St. John.
Dan Rudd
CFO
SureDeposit

Hi Dan - I hadn't known that! Thanks for the info, I'll definitely go read that article - we work closely with Kimball et al so it'll be neat to read something he's written.

I use "Sure Deposit" and it has been one of my most effective marketing tools. More cost effective for a person to move in.

Is anyone using SureDeposit and the Hunter Warfield Collections Extract available through OneSite?

We began using SureDeposit earlier this month. The communities using SureDeposit are also using the Hunter Warfield Collections Extract available through OneSite. For anyone using both, did you have to turn off the collections handling and manually submit files to HW? How are you managing this?

Thanks!

Jessica

Sara Morrill wrote:

It sounds interesting, but nonrefundable deposits are a no-no in California. As a resident though I'd for sure love to pay a smaller deposit - at least it's a known quantity that I'm not going to recover and I can plan for it.

Sure Deposit is not actually considered a deposit, I believe it is a surety bond, so that may make a difference in California.

As Kim stated, it can be a problem if you have one property in your portfolio that draws from the pool on a constant basis, then the funds run out and you (your property) are not covered.

I like the program in many ways, but there are some aspects that I do not like.

I have taken a closer look at suredeposit. I think we are going to give it a try at our 173 unit in Houston. I'll respond later as to our progress and the ease of use in terms of setup.

There are a few things users really, REALLY need to understand about SureDeposit:
* The OWNER of the property is not protected if Management changes. SureDeposit does the agreement with the MANAGEMENT COMPANY. This is a BIG DEAL! In the states I practice, real estate license law (and ethics in general) dictate that we are fiduciaries to the Owner. We had a situation that we began managing 320 units and residents had been strongly urged to do SureDeposit. When management changed, SureDeposit would not honor the SureDeposit agreement and would not give the Owner a copy of what had been signed with the Management Company (nor would the Management Company). (Legal is still looking at this.)
* Residents are NOT protected by the bond. When they move out, if they owe money and you utilize the SureDeposit bond, SureDeposit then goes after the former resident to collect the entire balance owed by the resident, including placing them for collections.
* Residents may THINK they are protected from owing the landlord. We find the SureDeposit agreement that the residents sign not to be clear in telling the residents this.
* The Leasing Pro/Manager needs to be VERY CLEAR in the move-in process to point out that the resident will still owe any unpaid rent, damages, remainder of lease.
* The only real potential benefit to the resident of paying the SureDeposit amount is that it is sometimes a lower amount than paying an actual Security Deposit.

There are definitely benefits to SureDeposit to mitigate losses, but "Buyer Beware." Read carefully, ask questions, and if you don't own the property, make sure the Owner is informed of what he/she gets and doesn't get in the event of a management change.

Thank you Mary great information. I was not aware of this aspect of SureDeposit.

Since some renters may be new to SureDeposit’s security deposit alternative, it’s understandable that they might have some initial questions about how the program works. This is why the top item on the form that residents sign when they opt for SureDeposit’s bond reads:

I am enrolling on a bond the Bankers Insurance Company (Surety) issued for the benefit of [the apartment community]... Moreover, this bond is not liability or other insurance, and thus does not relieve me of any responsibilities I have under the lease, including responsibility for physical damage to the property or for unpaid rent.

In addition, SureDeposit provides ongoing support to both to new and existing clients to reinforce how the program should be explained to residents at the leasing desk.

That seems to be the confusion, A deposit is defined as 'refundable' and a fee is just a 'non refundable charge' for services or otherwise. So, yes, non refundable deposits in CA is a no go (anywhere for that matter) but thats why it must be labled as a non refundable fee, not a deposit. I think people get the 2 confused. so the payment thats not refundable to the landlord for the suredeposit service is a fee, not a deposit. its to pay for the services of deposit coverage. if that makes sence. :) Looking into this myself!!! I am trying to see what other companies there are that do this same thing. Thanks!!!

An apartment complex misrepresented the Sure Deposit program to me when I moved in. They stated I would not have to pay for any damages over $500, which is not true. It's great for them to push because they can then gouge you on any cleaning/repair and don't have the burden of taking you to collections.

The sure deposit is a waste of money if you have good credit and can qualify for a decent security deposit on your own.

Sure deposit is basically an insurance to the owner (apartment complex) that they will get their money for any problems or outstanding charges after a tenant moves out. It does not mean you as a tenant will not have to pay for those charges, It means that the suredeposit company will pay the charges to the apartment complex, and then they will bill the tenant for it.

It is usually misrepresented as it was for me.

I was told I was purchasing a $500 bond that would cover any damages etc. when I moved out of my last apartment, and that I would have to pay any damages over that $500 if there were any. I paid just under $90 for this sure deposit (for $10 more at another apartment complex I could have gotten a refundable security deposit, i felt so stupid.) I had a bad accident breaking my right ankle and needing surgery right before I moved out of the apartment. Since I was told I would only be responsible to pay any charges over the $500 that the sure deposit covered, and I was having such a hard time getting everything moved out in time, I decided to go ahead and not have the carpets professionally cleaned and let the sure deposit cover those charges. Had this happened somewhere where I just paid a regular refundable security deposit, my deposit would have gone towards the cost to have the carpets cleaned. Instead, the sure deposit was $90, and then I had to pay an additional $250 because the apartment complex decided to charge above and beyond the price to have carpets cleaned. The sure deposit company paid them for the charges and then sent me to a collection agency to recoup their charges. I was not happy. I felt ripped off, and I will never use sure-deposit again.

Sure Deposit IS A COLLECTION AGENCY! When I moved out appartment complex Would NOT give me a final bill. It goes right to Sure Deposit to collect They start calling and harassing right away EVEN BEFORE I got the bill from them.Ill never use them again.