My daughter and her friends have applied to rent an apartment, and the landlord is charging them a security deposit, plus the last two months’ rent. Is this legal? If they push back, will they lose the apartment? They’ve already paid a deposit and application fee.
Under the new rent laws recently passed by the New York State legislature, landlords can no longer require renters to pay the last month’s rent up front. That doesn’t necessarily mean, however, that your daughter can push back without any consequences, says Sam Himmelstein, a lawyer at Himmelstein, McConnell, Gribben, Donoghue & Joseph, who represents residential and commercial tenants, and tenant associations.
The new legislation states that when a tenant begins a new apartment lease, “no deposit or advance shall exceed the amount of one month's rent.”
“That means the landlord cannot ask for the last month’s rent, so this landlord is violating the law,” Himmelstein says. “But there’s the practical side of this: Since the tenant is not in the apartment yet, the landlord could turn around and deny her the apartment. This person has to use their judgment.”
Tenants in this situation have to consider how badly they want the apartment, and whether it’s worth the risk that may come with refusing the landlord’s request. They do have the law on their side, but that doesn’t entirely eliminate the risk of the landlord turning down their application. (Note that if your application is denied, your application fee and any deposit must be returned.)
There are a few ways to exercise your rights as a renter, Himmelstein says. One is to write a letter to the landlord (and the broker, if there is one) stating that what the landlord is demanding is illegal, and if the sole reason they would turn down your application is because you are asking them to comply with the law, that would be unlawful.
How this might play out is unclear, as the new legislation does not specify how to remedy a situation in which the landlord isn’t obeying the law.
“Another option is to move in and pay the last two months’ rent, but apply that payment to the second and third month’s rent,” Himmelstein says. “You could write a letter stating that since the landlord demanding receipt of the last two months’ rent was illegal, you are applying that payment to the second and third month.”
This method at least gets you into the apartment, but if it’s a market-rate unit, there is nothing other than New York’s anti-retaliation law, which was also strengthened in the recent legislation, to stop your landlord from declining to renew your lease next year. If it’s a rent-stabilized unit, on the other hand, you are protected from this; you can also complain to the DHCR, which oversees rent-regulated apartments, about a landlord who is violating the law.
There may also be actions you can take after the fact, if the landlord rejects your application for your refusal to pay up.
“You could try filing a complaint with the Attorney General’s consumer protection bureau,” Himmelstein suggests. “And if there is a broker involved, you could go to the Secretary of State, which is the licensing bureau for brokers, and complain that the broker is violating legal rental practices.”
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Sam Himmelstein, Esq. represents NYC tenants and tenant associations in disputes over evictions, rent increases, rental conversions, rent stabilization law, lease buyouts, and many other issues. He is a partner at Himmelstein, McConnell, Gribben, Donoghue & Joseph in Manhattan. To submit a question for this column, click here. To ask about a legal consultation, email Sam or call (212) 349-3000.