Agents & Landlords: Tenant enquiring about interest on deposit

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AlexFl

Well-Known Member
Joined
Aug 12, 2010
Messages
375
Hi all,

Tenant served notice on my residential cottage. Has requested 'statement of deposit, including interest earned'. Lease doesn't cover same and I've never had such a request (for interest payment) before. Is there an obligation (legal, moral, etc.) to pay interest on a cottage deposit?

Looking forward to your qualified inputs. Thanks in advance.
 
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Splinter

Honorary Master
Joined
Oct 14, 2011
Messages
29,651
Yep. By law, you are supposed to have put into a separate call account earning some interest. Doesn't define how much interest though. Mine is earning a whopping 3% last time I checked. It's quite easy to do with most online banking. FNB is super easy for this.
 
DrJohnZoidberg

DrJohnZoidberg

Honorary Master
Joined
Jul 24, 2006
Messages
22,835
the deposit contemplated in paragraph (c)must be invested by the landlord in an interest-bearing account with a financial institution and the landlord must 10 subject to paragraph (g) pay the tenant interest at the rate applicable to such account ~hich may not be less than the rate applicable to a savin&s account with a financial institution. and the tenant may during the period of the Iease request the landlord to provide him or her with written proof in respect of interest accrued on such deposit, and the landlord must provide such proof on 15 request: Provided that where the landlord is a registered estate agent as provided for in the Estate Agency Affairs Act, 1976 (Act No. 112 of 1976), the deposit and any interest thereon shall be dealt with in accordance with the provisions of that Act;
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saturnz

Honorary Master
Joined
May 3, 2005
Messages
18,258
The Act also requires that the landlord deposits this money into an interest bearing account, held with a financial institution. The tenant has the right to request a statement of interest earned on his money at any time. The tenant is also entitled to receive the deposit and all interest earned on the money over the period it was held for, at the end of the lease agreement period.
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I still feel this forum needs a property section, property questions get asked all over the place
 
RedViking

RedViking

Nord of the South
Joined
Feb 23, 2012
Messages
47,117
AlexFl said:
I'm a little smarter today. Thanks y'all.
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You are not the only one. Also had to inform another person who was renting out their house but shocked when they were told to show the interest on the deposit.

I am surprised that people rent out their homes but don't get the proper documents and advice first to avoid headaches. But then again, things like this can happen to anyone.

I would really suggest you get some valuable professional input to avoid future issues , as well as make sure the contact is up-to-date. There are a bunch of stuff, as a landlord, you need to be aware of and can help against future heartache.

Not the best time to have tenant issues. :)

*not a qualified input
 
WorldWarIII

WorldWarIII

Expert Member
Joined
Apr 9, 2019
Messages
1,702
it is law, But honestly Im still to see it done properly.

WHat you can do if they hardballing is see what contract stipulated about yearly increases and see if you did increase. Sometimes you can ask them for sympathy if you didnt raise the rent.
 
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