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Ray
Ray, Lawyer
Category: Real Estate Law
Satisfied Customers: 37010
Experience:  Texas Attorney for 30 years dealing in real estate
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I am struggling with this website. Hopefully you have access

Customer Question

I am struggling with this website. Hopefully you have access to the previous answer, but I will copy my original question below.
A clearer question would be: this application clearly states that if the prospective tenant changes their mind and decides not to rent my property that I can keep their deposit. If they sign this, is there any reason that I would not be able to keep it? Does something else come into play other than the black and white text of the agreement?ORIGINAL INFORMATION:
Is there anything in the first paragraph...
Is there anything in the first paragraph of this section of my rental application that does not conform in any way to Colorado law? I did download it from a website of Colorado legal documents. If, after filling out the rest of this application and giving me the deposit, someone sends me a notesaying that they have found a place that they prefer and will be renting that, can I legally keep the deposit. I had already informed other applicants that the unit was rented and pulled the advertisements for rental.
ThanksI, hereby agree to lease from Jane Doe, known as the Landlord, the above premises. As an indication of my good faith in making this offer, I hereby hand the Landlord the sum of $1200 (Twelve hundred dollars) in the form of certified check, cash or money order as a rental deposit on the premises on the understanding that if my offer is accepted, the deposit shall be retained by the Landlord as a Damage Deposit, in accordance with the provisions of the Lease Agreement, and if my offer is not accepted, the full Deposit will be refunded to me. However, if my offer is accepted and I cancel the application or fail to execute the Lease Agreement, when prepared and presented, then I agree that the said deposit shall be absolutely forfeited to the Landlord. This shall be considered liquidated damages and not a penalty. Acceptance of this offer will be deemed to have been made by the Landlord's execution of the acceptance section. I understand that I will need to provide the first and last month’s rent on or before the move in date.TERMS TO BE INCLUDED IN THE LEASE AGREEMENT:1 No pets unless written permission given by the Landlord, pets brought onto the premises without written consent will immediately be just cause for lease termination.2 All utilities are the tenants responsibility unless stated otherwise in the lease agreement. Utilities must be in the tenants name on or before occupancy date.3 The premises is NON SMOKING. Smoking inside premises will immediately be cause for lease termination.All statements that I have made in this application are true. I authorize the landlord to do a credit check and criminal background check. By signing this application ALL personal information is consensually given for use by us or o
Submitted: 5 months ago.
Category: Real Estate Law
Expert:  Ray replied 5 months ago.

Hi and welcome to JA. Ray here to help you today.

Under the terms here you are free to keep the deposit if the tenant changes their mind as your liquidated damages for loosing potential tenants for several days.It is clear the tenant agrees to this and you are entitled to the funds in such a situation.It is clear here that you put the tenant on notice if they backed out after paying deposit you are allowed to keep the deposited funds here.You are free to do so anytime the tenant changes their mind.

I appreciate the chance to help you today.Thanks again.

Customer: replied 5 months ago.
Were you able to see the previous response? I have just figured out how to copy it here. This seems to imply that maybe I can't keep it unless I can prove actual expenses (which there were some of course by more it was the expense of my time and stress and negative impact on my schedule due to the unplanned relisting)Dear Customer,Thank you for using our forum. My name is ***** ***** I hope to assist you today.While the holding deposit clause is not uncommon, the scope of the liquidated damages is likely going to be considered excessive (Courts dislike liquidated damages in all contracts, not just landlord/tenant damages where they are particularly protective, rather they prefer damages to be assessed at a rate that more closely approximates the injured party's actual damages following the other party's breach of contract).Holding Deposits Some landlords may require a “holding deposit” from prospective tenants to show that the tenant is seriously interested in renting the apartment. Make sure that you clearly understand any terms and conditions associated with any holding deposits or fees. Generally, an owner who has taken an apartment off the market and held it for you based on your promise to rent (presumably turning away other applicants), can deduct reasonable amounts from a holding deposit to cover costs of keeping the apartment vacant (usually in the form of a daily rental charge) or costs associated with advertising.
Source: https://dola.colorado.gov/app_uploads/docs/Renter_booklet_2009.pdf
Expert:  Ray replied 5 months ago.

I think here you have good language to hold the deposit..

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