The rental security deposit can be a hugely contentious issue when it comes to renting in Singapore.
For the uninitiated, the rental security deposit is money a tenant deposits with the landlord which serves as a protection should the tenant stop paying rent or damages the property.
In Singapore, it is normal for landlords to require a rental security deposit of 1 month for a 1 year lease and 2 months for a 2 year lease.
Landlords here have full control over the deposit money and this has created many complaints from tenants of landlords refusing to return the rental security deposit.
This is unlike other places like New York, where the rental security deposit has to be treated as trust funds belonging to the tenant up until the end of the lease.
The money also cannot be commingled with the landlord’s personal money, which creates a more trusting environment.
Which is why here at RentHero, we are looking to change that for tenants in Singapore with our secure deposit function.
Nevertheless, if you are in a situation now where your landlord is refusing to return the rental security deposit, here are some steps you can take:
What to do if your landlord refuses to return your rental security deposit
1. Get the landlord to provide reasons
If you feel that you have done everything by the book and have not violated any terms in the tenancy agreement, it will be good to get the landlord to put everything in writing and show proof of the usage of deposit (if any) with invoices/receipts of repair works done.
This will allow you to understand clearly what works and costs have been taken into account
2. Try to mediate
Sometimes disputes can happen because of miscommunication or poor expectations set out from the beginning.
Mediation can be a good way to resolve things before taking any further action.
With the Singapore Mediation Centre, mediation can now even be done online and at a small cost.
According to their statistics, more than 4,000 matters have been referred.
About 70% of the cases mediated are settled, with 90% of them being resolved within one working day.
Of course, the downside of mediation is that the landlord needs to be willing to cooperate.
So if that doesn’t work, stronger action must be taken.
3. Use the Small Claims Tribunal
Engaging a lawyer is usually the last resort as the cost can be prohibitive.
You can always resort to using the Small Claims Tribunal if your rental security deposit is less than $10,000 and with a lease that does not exceed 2 years.
The other issue with this route is that you will have to be present in Singapore for this to work.
4. Send a letter of demand
You can engage a lawyer to send a letter of demand.
This will set out a list of demands that the landlord has to comply with, or there will be further legal action taken.
In other words, if the landlord knows that they have been trying to take advantage of the situation, they will know that they have to back down.
Feel free to leave a comment below if you have any stories to share about your rental experience in Singapore!