If ownership of a rental changes, who’s responsible for paying back a security deposit to a renter?
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If ownership of a rental changes, who’s responsible for paying back a security deposit to a renter?
Asked on January 19, 2011 under Real Estate Law, Michigan
Answers:
M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
Generally speaking, most state laws state that when the ownership or real property that has a rental unit occupied by a tenant, is transferred to a new owner the prior owner must also transfer all security deposits being held on behalf of the tenant to the new owner on closing. The security deposit is the property of the tenant and is not the landlord's to take. So it follows that it need to be transferred to the new owner. If you are the new owner and the seller did not transfer the money to you at closing, contact the seller and demand the money. What he or she did was probably against the law. Good luck to you.
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