What are rental deposit alternatives?

Rental deposit alternatives are programs or services offered by landlords and property managers that allow tenants to pay a monthly fee instead of a traditional security deposit or last months’ rent deposit when renting a property. This fee varies and is generally a fraction of the cost of a traditional security deposit.

Except in Quebec and Ontario, landlords are permitted to request that tenants provide a security deposit ranging from half a month’s rent to a full month’s rent. In Quebec and Ontario, when a landlord asks a tenant to pay the last month’s rent, this is a rent deposit, not a security deposit. If the landlord charges a rent deposit, it must be held and used to cover the tenant’s last month’s rent. Each time the rent increases, the landlord can require the tenant to top up their last month’s rent deposit to the new amount. For more information on traditional rent deposits, refer to 436 Rent and security deposits.

If you are a large-scale landlord or property manager, visit Rental Deposits Now to learn how to get started.

If you are a tenant, ask your landlord or property manager to consider Rental Deposits Now as an alternative to the traditional security deposit.

Frequently asked questions about rental deposit alternatives

Who can use Rental Deposits Now?

Property management companies and landlords who have multiple tenants are eligible. Individual tenants cannot join the program on their own.

What are the benefits for property managers?

Property managers benefit from more protection than a traditional deposit, as well as Improved administrative efficiency and lower costs, resulting in higher ROI. For example, no need to administer trust accounts for deposits or running around trying to collect late rents.

What costs are covered?

Eligible reimbursements  include damage to properties and appliances, key cutting, unpaid rent, evictions, legal costs, and more.

How are claims handled?

All claims are handled through an online system, and reimbursements are quick, sometimes paid out on the same day.

Do property managers need to change their current management systems?

No. The program will integrate with modern property management systems.

What are the benefits for tenants?

Tenants enjoy a reduction in move-in costs, since the program eliminates the need for them to pay a large, up-front deposit.

How much do tenants pay?

Depending on the program selected, the monthly cost is usually between one and five percent of rental amounts.

Can tenants opt out?

Yes. Tenants have the option to pay traditional cash deposits instead.

Do tenants need to apply for the program?

No. Eligible tenants are given the option to use the deposit alternative program without having to apply and be approved, based on the operator’s credit criterion.

Can tenants who have already paid a deposit switch to the program?

Yes. If a tenant has already paid a deposit, property managers can switch them to a deposit alternative and return the original deposit.

Get help

If you are a large-scale landlord or property manager, visit Rental Deposits Now to learn how to get started.

If you are a tenant, ask your landlord or property manager to consider Rental Deposits Now as an alternative to the traditional security deposit.

To learn more about rental deposit alternatives, refer to 1451 Rental deposit alternatives.

								
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