Kellie Tollifson joins me today from Seattle, WA. She’s the incoming NARPM president in 2020, and is a great resource. Today, we’ll take a deep dive into the topic of security deposits, where things might slip through the cracks, and how to deal with everything throughout the life cycle of security deposits. If you’ve ever wondered about any part of the subject, this is the episode for you!
Before we start today, I want to tell you about our upcoming conference! Pulling Back the Curtain will take place in January 2019 in Atlanta, GA. I’m one of the four speakers at the event, and I’ll be talking about the sales tactics that have helped us grow by adding more than one door per day for the last two years.
Kellie and her husband, Tom, own and operate T-Square Properties. They started in the industry by buying and selling their own rentals, then realized they could do that for other people too. They’ve been in the business for two decades, have fourteen employees, and manage about 450 doors. About ten years ago, they also developed a maintenance company.
In today’s conversation, Kellie will point out why it can be a problem to charge a security deposit that’s the same amount as one month’s rent: tenants can be confused and think that their deposit was actually their last month’s rent. She’ll also talk about cases in which she charges a higher security deposit, and what regulations are in place in Seattle to limit move-in costs. Tune in to hear more about all of this, as well as trust accounts, the end of the lease and the inspection process, and how to handle negative reviews.
Here’s where you can find Kellie:
[03:21] - Kellie gives a quick introduction to herself and her company to provide listeners context for what she’ll be talking about today.
[05:32] - How much should you charge as a security deposit? She answers, then Brad shares some of his own methods for calculating a deposit.
[10:30] - We hear about some fees that can be charged instead of a deposit.
[11:26] - Brad brings up a technique that involves using a bond instead of a security deposit.
[15:01] - What form of security deposit does Kellie take?
[17:57] - Kellie talks about at what point in the process she takes the security deposit, and points out another quirk of the Seattle market.
[24:10] - Brad brings up another question: what do you do in terms of leasing-only security deposits?
[29:45] - We hear about trust account funds, audits, and reconciliations, specifically in a highly regulated state.
[32:10] - Is Kellie allowed to do anything with that trust fund, such as collecting interest or purchasing CDs?
[35:35] - We move onto talking about the end of the lease, and how Kellie’s inspection process work.
[38:27] - Kellie takes move-out pictures instead of doing videos, because pictures have still been working really well for her.
[40:47] - We learn about how Kellie breaks down invoices for former tenants.
[42:36] - Brad brings up the topic of prorated charges, and how the depreciation scale functions for this purpose.
[46:30] - What’s the review process that happens if a tenant wants to refute one of the security deposit itemizations?
[50:58] - Kellie talks about how she handles negative reviews when it comes to tenants’ security deposits.
[55:01] - We hear about NARPM’s leadership seminar and classes.
[56:58] - Kellie explains her current role at the national NARPM level.