Monday, July 18, 2011

Everyone's Running a Racket

I came home to a very welcome surprise in the mail today: our security deposit from our New York deposit, refunded in full. Yippee!

I had expected a fight in order to get that back, as I've had to do with every previous New York landlord, but they sent it very quickly and within the terms in the lease.

One thing they didn't include, which is required by New York state law, is any interest earned on the money during the two years it was in their possession. Landlords of apartment buildings with more than six units are required to keep deposits in individual interest-bearing accounts, inform the tenants of the bank name and account number of those accounts, and return the interest earned annually or at the end of the lease term, less a 1% fee for administrative costs. That 1% is based on the deposit total, not the interest earned, and in our case, it looks like our security deposit earned exactly 1% each year, meaning they got to keep the entire interest earned as their fee (note, however, that we had to pay taxes on that interest!). Most likely, based on my rough calculations, we're probably owed an additional buck or two - which is not really enough for me to go through the trouble of writing a letter or filing a complaint form with the attorney general's office.

I'm not totally complaining - we did get the deposit back without a fight, and sadly, 1% is not a terrible rate to earn in this economy, but we found higher rates than that without much looking. A powerful entity owning hundreds of apartments (and therefore managing hundreds of accounts that are totally stable on an annual basis) could probably throw their weight around to get a better deal than that. And an unnoticed $2 on each of those hundreds of accounts each year winds up being quite a bit more than the company bowling party would cost, you know?

At any rate, $1400+ of our money has been returned to us, and will go into the eventual house fund, so on the whole, it's something to celebrate!

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