Residential Lease (TXR 2001)
When multiple tenants are listed on a lease, there can be confusion about who to make the check payable to in the return of a security deposit at termination. This issue comes up quite often in roommate situations or where a couple divorces and are both named as tenants on the lease. Often, one roommate or spouse will request that the security deposit be made payable to only that roommate or spouse. Paragraph 10C of the Residential Lease (TXR 2001) requires that the landlord make the check payable to all tenants named on the lease. Since all tenants are parties to the lease, they are all entitled to any refund of the security deposit.
Does this mean that it will be one check with all of the tenants names on it ? Or , multiple checks with the deposit divided equally for each check?
One single check including all names
I write one check to ALL tenants unless I hear, in writing, from ALL parties how to divide it up. Only then will I mail separate checks.
Yep
Unfortunately this is incomplete information by TR. I think most of us understand what the lease says. What about a written directive from the tenants ( signed) that they desire it to be split or divided? That is what we get most often. They should have expanded on that aspect and provided guidance. Thanks,
Keep it simple and stick to what the lease already has in it. Cut one check to all the tenants. Let the tenants know they will need to resolve any issues among themselves from there. By doing otherwise you are putting the burden on you (or the landlord) and creating possible liabilities. Tenants can not direct you to do anything other than what was already agreed on in the lease.
That’s correct.
This needs to be changed in the lease. Often roommates move out of town or country and the remaining tenants cannot cash the check without everyone’s signature! Have you ever received a check with multiple names on it and attempted to cash it!! Often times all parties have to be at the bank to cash this! This is outdated and needs to be revamped for today’s business standards. We send our deposit refunds electronically!
I’ve followed the lease for over 30 years and am a full time Property Manager. One check, all named tenants. They can figure it out. I just hope everyone answering is a PM, because everyone else would not have the authority. Even tenants that have passed have executors and heirs that can cash the check. So can broken couples or divorced tenants. Not our job, only our liability if someone doesn’t like it.
What if one tenant doesn’t complete the lease, Wouldn’t the deposit stay with the home till lease is completed?