Personal Finance

Deposit increase after renewing lease

  • Last Updated:
  • Mar 8th, 2019 2:19 pm
[OP]
Member
Oct 13, 2018
205 posts
238 upvotes

Deposit increase after renewing lease

So I recently renewed my lease for 6 months and with the increase in rent , I also got slapped with an increase of rental deposit . Is this legal ( I live in BC) ?

As I was doing my research of rental increase , I found that landlords have to pay interest on Rental deposit. Does this mean I should get some interest back on deposit I paid or will I get an interest once the contract ends and I leave the apartment .

Thanks
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10 replies
Jr. Member
May 17, 2018
102 posts
25 upvotes
Why is the security deposit less than one months rent? Is that a damage deposit? If so, those are illegal (Ontario at least but many people ask and pay anyway)

You are supposed to get interest paid on your deposit(s). And any landlord I've ever had has just forgone the rent increase and not paid me interests. Works in my favour. However I would be asking them to apply the interests to my deposits. If you figure 2% per year the interest would almost negate the increase


Ask for clarification

If you left them a "last months rent" they have to pay interest on that as well

The nice thing to do would be to just say that your current deposit is adequate or that they've added interest to it and no extra payment is needed and that the deposit is $xxxx now
Jr. Member
May 17, 2018
102 posts
25 upvotes
Also, what kind of keys do you have? Key deposits are limited to the actual cost of new ones


Our current place asked for a $500 damage and key deposit

We signed back with $20 mail box cost, $5 per key and $50 per garage remote

I offered them a flat $200 for all deposits with the suggestion to remove totally as it's not legal and they accepted my $200 and the condition that it's not to be held for any actual damages and that they acknowledge their deposit may be invalid in court

I really wanted this place and they really liked us
Jr. Member
Nov 26, 2012
123 posts
90 upvotes
Toronto
OP is in BC where security deposits are allowed.

1. Your deposit is not allowed to be raised due to a rent increase. It’s up to 50% of your first month rent. First month there ever. Not first month of renewal/extension of lease.

2. Technically, you get interest on the deposit BUT the Interest rate is set at 0% for like the last decade. So you get nothing.

https://www2.gov.bc.ca/gov/content/hous ... s-and-fees

https://www2.gov.bc.ca/gov/content/hous ... g-deposits
Deal Addict
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Nov 14, 2003
3388 posts
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I'm a BC landlord and I am pretty sure key deposit isn't permitted. The maximum security deposit is 50% of the monthly rent. In your case that would be $648. Your landlord owes you money.

The interest rate on security deposits has been zero the last several years so you won't get anything back from that other than the original deposit.
[OP]
Member
Oct 13, 2018
205 posts
238 upvotes
prxprx wrote:
Mar 7th, 2019 7:28 am
Why is the security deposit less than one months rent? Is that a damage deposit? If so, those are illegal (Ontario at least but many people ask and pay anyway)


You are supposed to get interest paid on your deposit(s). And any landlord I've ever had has just forgone the rent increase and not paid me interests. Works in my favour. However I would be asking them to apply the interests to my deposits. If you figure 2% per year the interest would almost negate the increase


Ask for clarification

If you left them a "last months rent" they have to pay interest on that as well

The nice thing to do would be to just say that your current deposit is adequate or that they've added interest to it and no extra payment is needed and that the deposit is $xxxx now
My original rent last year was $1225 which got raised to $1256. Based on last year rent my deposit was $612.50 .
[OP]
Member
Oct 13, 2018
205 posts
238 upvotes
Update I spoke to rental tenancy branch for BC And they clarified that increased damage deposit is illegal. Thanks for all the help people !
Deal Fanatic
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Jan 9, 2011
5635 posts
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Vancouver
TusharN30757 wrote:
Mar 7th, 2019 3:59 am
So I recently renewed my lease for 6 months and with the increase in rent , I also got slapped with an increase of rental deposit . Is this legal ( I live in BC) ? contract ends and I leave the apartment .
Thanks
It sounds like your original lease included a "must move out" clause at the end, but your landlord let you sign a new one instead of having you move out. If this is the case then yes, you are entitled to a refund of the original damage deposit, but you have to pay the new one, which is going to be higher. This "must move out" on paper "but you can renew if you want" verbal agreement is a scammy loophole for landlords to increase the rent by much higher amounts than they would otherwise be allowed.
[OP]
Member
Oct 13, 2018
205 posts
238 upvotes
Kiraly wrote:
Mar 7th, 2019 4:21 pm
It sounds like your original lease included a "must move out" clause at the end, but your landlord let you sign a new one instead of having you move out. If this is the case then yes, you are entitled to a refund of the original damage deposit, but you have to pay the new one, which is going to be higher. This "must move out" on paper "but you can renew if you want" verbal agreement is a scammy loophole for landlords to increase the rent by much higher amounts than they would otherwise be allowed.
Thanks for this info. Let's see what Tenancy Branch says . It's getting tough finding a decent place to live without being atrociously charged by these rental companies in Vancouver.
[OP]
Member
Oct 13, 2018
205 posts
238 upvotes
Kiraly wrote:
Mar 7th, 2019 4:42 pm
So did your original lease agreement include a written "must move out" clause in it? The government considered closing that loophole last year but then never did.
I have to check that. Good point .

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