You might have been hearing a lot about security deposit alternatives if you haven’t already implemented one. The idea of these are to keep the property manager protected while also helping residents who cannot afford the standard high up-front cost of moving into a new home. This can help remove a huge block for any potential renters in any economic state, and especially now.

A few popular security deposit alternatives currently in the market are:

Obligo:

Obligo is a “non-insurance” deposit alternative where renters do not pay an up-front security deposit and only get charged if the property manager submits a charge for damages after the lease ends.

Rhino:

Rhino is an insurance agreement between renters and property owners. It protects property owners against unpaid rent and any damages that would normally cause money to be deducted from a cash security deposit. Tenants who have already paid a security deposit can still sign up for Rhino and get their security deposit amount refunded, which may help many residents at this time.

These two are great options for security deposit alternatives that are greatly helping both residents and property managers with move-ins. However, there is another option that can both help the remove up front costs for the resident and generate additional revenue for the property manager.

Deposit Waiver Concept:

This concept involves the resident paying a non-refundable security deposit waiver fee on a monthly basis in addition to their monthly rent. Recently, Todd Ortscheid with GTL Real Estate signed a new lease with a tenant that agreed to pay a non-refundable $120/month security deposit waiver fee instead of a refundable full month’s security deposit up front. The rent on the unit is $1,995/month so within 16 months the resident would have paid a full one month deposit. Their average resident stays in their homes for over double that time, so even after move-outs and repair costs they would turn a profit.

This concept may not work for all residents, but it can work for some. Todd goes into deeper detail on this particular method in his Fee Maxing course at PMAssist.com.

This post was originally published in our weekly growth newsletter PropertyBrew. You can subscribe here to get business-boosting growth hacks tailored for Property Managers to your inbox every Tuesday morning. 

About Latchel

At Latchel we take over property maintenance coordination giving property managers the time to focus on more important things.

We do this through our 3 core products:

  1. Our after hours emergency service, which ensures you are never woken up in the middle of the night for a maintenance call again;

  2. Our 24/7 emergency service, night or day, all day, every day, we’ve got you covered;

  3. Our premium service, which is an all encompassing maintenance coordination product.

Across our reviews, we boast a 4.7 out of 5 stars for tenant satisfaction. Property managers who have switched to Latchel, on average, have reduced their time spent on maintenance to only 15 mins per day for every 100 units.

We improve the maintenance experience for everyone because at Latchel, we truly believe that you cannot get better by staying the same.

Interested in booking a demo? Schedule a meeting with us below:

Book a Demo