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Fee vs. deposit: What’s the difference?

May 3rd, 2017 9:21 AM by Ron Mastrodonato

Fee vs. deposit: What’s the difference?

By Meredith Caruso

May 1, 2017 – Have you ever seen someone reference a "nonrefundable deposit" and wonder whether it's a deposit or a fee?

That "nonrefundable deposit" doesn't make much sense to those of us working Florida Realtors Legal Hotline either, and the parties would have been better off using the correct term to match the landlord's intent.

As a general concept, a deposit is money that is likely refundable. For example, a pet deposit is money retained by the landlord on the tenant's behalf and, assuming there is damage to the property by the pet, the landlord can make a claim on these funds. If there is no damage, the money is returned to the tenant.

But what if a landlord wants to charge a tenant money simply for the pleasure of having a pet in the property, regardless if there is damage or not? In that scenario, a landlord would likely want to charge a pet fee, not a pet deposit.

A fee, in contrast to a deposit, is money owed to the landlord at the time of payment, and it's generally not refundable.

As always, the document language used in association with any monies collected can be important in determining if funds are owed or due to the parties.

Meredith Caruso is Manager of Member Legal Communications for Florida Realtors

© 2017 Florida Realtors

Posted in:Real Estate
Posted by Ron Mastrodonato on May 3rd, 2017 9:21 AM


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