House passes security deposit alternative bill

A bill that would create consumer protections for tenants who choose to pay a monthly fee instead of a security deposit cleared the full House on Thursday with an 88-27 vote.

Security deposit alternatives allow renters to avoid paying a security deposit — often equivalent to a full month’s rent — and instead pay a monthly fee.

Companies such as Assurant, LeaseLock, Rhino, Obligo and Jetty all offer security deposit alternatives that range in price and terms, but typically cost a fraction of a security deposit.

HB 537, sponsored by Republican Rep. Jim Mooney, would ensure the terms of any security deposit alternative agreement are fully disclosed before a lease is signed and provide tenants with a guarantee that they may cancel the payment plan and instead provide a security deposit mid-lease.

The bills under consideration this Session would not, as some have intimated, give one company an edge or set up a protected market. According to Mooney, the legislation serves to protect consumers by requiring they be informed of the pros and cons as well as their rights before they sign a lease.

“It is 100% optional for both sides. If you have money for a deposit, great. If you have other needs for that deposit money, like food for kids or tires or electric deposit, then you make the choice of ‘do I take the unit with this program or do I go somewhere else.’ Your choice. You are always responsible for the care of the unit and the rent,” Mooney told Florida Politics.

“At the end of the day, I think most of us have had a situation with rental entrance. Sort of that move-in day problem of ‘where is the money coming from.’ We have added guardrails to make sure that the tenant understands this is not a deposit and that they have all the same rights they would have as if they paid upfront.”

The Senate companion, SB 884 by Republican Sen. Jim Boyd, is awaiting a hearing in the Senate Rules Committee, which is its final stop before the chamber floor.