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A little background. In North Carolina property management companies are considered real estate activities under existing North Carolina real estate licensing laws. If a property manager is engages in the business of leasing, renting, or listing, or offers to perform any of those acts, a broker’s license is required
Under law, and in accordance with North Carolina Real Estate Commission guidelines, your tenant’s security deposit should have been held in an escrow account, also known as a trust account.
At lease termination we will inspect the property and the security deposit will be returned to the tenant less any costs to repair damages that exceed normal wear and tear. The North Carolina Real Estate Commission has strict policies as to the handling of security deposits that must be followed to the letter of the law.
You may have signed a contract with the property managers, and if you did the terms and timeline for returning the tenant’s security deposit should be detailed. Look through the contract, and determine if there is a time frame stated, and if they are outside the time to return the deposit to you, and any notice requirements.
If they are just refusing to return the you have two option, the first would be to start an action in small claims court against the property management company for breach off the contract and your damages, which includes all expenses and costs associated with their failure to return the deposits, including the delay and cost incurred by you in repairing and re-renting. So your demand should include the rent lost from future tenants and any costs in the delay. You should write a letter to them detailing your expenses and lost rent from their failure to turn over the security as required by the law.
The other option would be to file complaint with the North Carolina Real Estate Commission at (###) ###-####who regulates real estate management companies and their license. You can also file a complaint online at https://www.ncrec.gov/. They will investigate and force a resolution in the retention and failur to return the security, which is only held in a trust account by the company and is not their money.
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