Beyond the Security Deposit: How to Deal With Extensive Damage & Repairs

By Kaitlin Hurtado on November 16, 2023

As a property manager, you will have to handle a variety of responsibilities on a daily basis. From screening potential tenants to overseeing property maintenance, there is plenty to be done in order to make your rental property a successful one. Unfortunately, one major thing you are in charge of is ensuring that all units are properly maintained. As much care as you put into screening tenants to protect your property, things happen and you may be left with a badly damaged unit once a tenant vacates the property.

Security deposits, of course, are put in place to protect both parties. They can help a tenant cover any potential damages that occur during their lease, and they can help provide security to you knowing there are secured funds to cover damages. However, depending on how extensive the damages are, you may find that the security deposit will not cover the extreme costs of repairs due. Not sure how to approach the situation? Keep reading for tips on how to deal with extensive damage and repairs.

Photo: Pexels

Document all damages

As soon as you are aware of the damages, whether it be from a pre-moveout inspection or a post-moveout inspection, be sure to document all damages as soon as possible. The sooner you document, the more “accurately” you can capture the tenant’s actual responsibility.

Take pictures, videos, and written descriptions of all damages to capture the full scope of damages. The more documentation you gather, the less likely the tenant will be successful in disputing the damages charged to them. As much as you will want to believe that a tenant will hold themselves accountable for damages, they may dispute that they caused those damages, or that they weren’t that bad when they moved out.

For example, the tenant may never have reported a leak or water damage. Some time may pass between their moveout and when you go to repair the apartment. In that time between, the issue could have escalated into flooding, mold, or extreme water damage. Accurately documenting damage in a timely manner will help everyone involved, especially if damages can lead to potential legal proceedings.

When documenting, you also will want to figure out who is ultimately responsible for the damages incurred. Is it the tenant’s responsibility as they didn’t follow the leasing agreement, or acted irresponsibly? Is it management’s responsibility, such as neglected maintenance needs leading to extensive damages (ignored maintenance requests of a leaking pipe leading to mold or water damage)?

Schedule repairs as soon as you can

Once you have assessed the damages, do your best to schedule the repairs, especially if they will involve an outside vendor. The longer your rental property sits idle and needs repairs, the longer it will sit vacant and mean more rental loss for you and the property.

Once a need for repairs is recognized, look for any necessary vendors needed to complete the repairs. Streamlining repairs will help give you peace of mind and also help you get things in order to charge the tenant for costs they will need to cover.

If insurance is involved, contact them as soon as possible when you assess the damage.

Keep track of repair costs

As you complete repairs required for the extensive damages, make sure you are properly documenting all costs, especially if the costs are expected to be covered by the tenant. Providing receipts and invoices for the required repairs will help make the charges to the tenant indisputable when you can accurately show which charges need to be covered, rather than you pulling a number out of thin air.

Depending on how extensive the damages are and how the tenant is expecting to pay you back, you may be paying each vendor or bill as they come and charging the tenant in a lump sum after everything is completed, or having them pay in installments. Be sure to keep track of all debits and credits as transactions are completed.

Take the opportunity to upgrade and renovate

If you are already taking the time to repair the unit, consider it an opportunity to upgrade the unit, which will ultimately help your rental property. Dirtied and damaged carpets, for example, can be ripped out and swapped for laminate or hardwood flooring.

Upgrading damaged appliances and features can help elevate the unit and make it more attractive to potential tenants in the future.

Damage to rental property is inevitable, whether it be accidental or purposeful. As a property manager, it is ultimately up to you to ensure that the property is restored to its original condition and ready to rent again. With these tips in mind, you can help yourself deal with extensive damage to your rental property.

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