Security Deposits Come In New Flavors
The security deposit landscape is changing. No longer do you have to hand over a huge stack of bills once you find an apartment and sign a lease. There’s a new player in town: the surety bond. Instead of having to float the security deposit on your new place when you find an apartment and pay the new security deposit at the same time, a surety bond cuts the size of that move-in cost by 80-90 percent.
Of course, such a powerful tool has its drawbacks. First, the entire amount of the surety bond is a cost, not a security deposit. You never get it back. Second, unlike security deposits, surety bonds only cover you for a fixed period, usually five years. Lastly, you’re still on the hook for any damage when you move out of the new apartment.
Still, for many folks who believe in good apartment maintenance, surety bonds can make the difference between being free to find an apartment that’s new, and being stuck in one.
How Surety Bonds Replace Security Deposits
With surety bonds, the fee goes to the bond company, not to the apartment manager. That company guarantees that the apartment management will be compensated for the amount of the deposit even if you cause a lot of damage and skip town. (Of course, we really don’t encourage that kind of behavior – especially since the surety bond company will destroy your credit and search for you to make sure you hold up your end of the security deposit/surety bond promise!)
In the case that you do violate apartment etiquette with some damage, you pay the surety bond company because they are the ones who have guaranteed the quality of your apartment tenancy. They then pay the landlord for the damage.
Where to Find an Apartment That Takes Surety Bond Apartments
These bonds are too new to be widespread, but their popularity is growing. To find an apartment near you that takes surety bonds, try searching at SureDeposit, one of the biggest bond companies.
Other Security Deposit Techniques
If surety bonds don’t sound like a winner to you, but you still choke at the cost of a move once you find an apartment, consider some other security deposit ideas when you do find an apartment.
- Borrow money from family or friends. You only need the money for about a month – time enough to get your security deposit back from your old place.
- Take out a personal loan from your bank. Again, you only need it for a month.
- Ask your boss for an advance on your paycheck.
- Ask your new apartment managers if they’ll put the security deposit on your credit card.
- Move all your purchases to your credit card and save up money in your bank account that way. Then use the extra cash to pay the security deposit. And don’t forget to pay off the credit card when you get your old security deposit back!