Overview
If a tenant moves from one lease to another, you'll need to transfer the security deposit if the original lease had a security deposit. This is also the case if a tenant moves out of one unit and into another. In other words, their lease ends on the old unit and a new lease begins on the new.
In this situation, you likely don't return their security deposit but hold onto it for their lease on the new unit. How do you record this in DoorLoop?
Don't worry, we'll explain how to handle this!
The Steps
Even though in the real world you might not be moving any money, in DoorLoop we need to show that the security deposit moves from the old lease to the new lease.
Make sure you have already created the tenant's new lease for the new unit and that you added the appropriate security deposit charge on Step 3 of that process.
Also, make sure you first withhold part of the deposit for move-out charges if necessary. You can also record withheld deposit funds as part of the End Lease process.
Step 1 - Creating a New Lease
Create a new lease first for the property/unit that the tenant is moving into. If you need a refresher on how to create a new lease, you can check out the article for adding a new lease.
You can't directly just transfer a lease mainly because of the transactions attached to the lease and the current property.
On the main menu, click Leasing and then click Active Leases.
Click the + New Lease button on the top right corner to begin the new lease creation wizard.
Go through the lease wizard and add all the relevant information to the lease and activate it. Make sure to include the new Security Deposit that will be going to the new lease. This will create a charge for it on the lease.
Move on to the next section.
Step 2 - Ending the Lease
The next step when transferring a lease to a new property or unit is to end the current lease.
For details and a refresher on how to end a lease, check out the article for ending a lease.
On the main menu, click Leasing and then click Active Leases.
Find the lease you want to edit a deposit for and click on it. You can either sort the list by the various columns and filters or use the Search leases search bar.
Once in the lease Overview tab, click on the blue circle with three vertical dots in the top right corner and select End Lease.
Once in the End Lease wizard, enter the required Move-out date (entering a Notice Date and uploading files is optional) and click Next.
The Move-out date will become the lease end date and tenant portal access will immediately end for all tenants on this lease.
If there are deposits, the next step would be to refund those deposits to the tenant. You're not actually refunding the tenant, just recording that the deposit is leaving the current lease. For the payment method, you can choose "other".
Alternatively, you can end the lease without doing anything and then refund the deposit after on the Inactive Lease.
Transferring a Lease Deposit
To transfer the Security Deposit over, it's as simple as just receiving payment for it onto the new lease.
Click on Leasing on the main menu and click Active Leases.
Find the new lease you want to transfer the security deposit for and click on it. You can either sort the list by the various columns and filters or use the Search leases search bar.
Because when you created this new lease you posted a charge for the security deposit, all you need to do now is to record that you received a "payment" for this on the new lease.
Record the payment for the same amount as the deposit, or what was left of it after move-out charges.
Toggle on the option to Automatically Deposit this payment because it is actually already in your bank account.
You can also record in the notes section something like, "Internal transfer: moved from Apartment 4 to Apartment 3."
Click Save and you are done!
End Result
After all this, the bank account balance will be the same as when it began.
If you increased the deposit charge for the new lease, or the tenant had move-out charges and needs to pay more to reach the full deposit amount on their new lease, there is nothing more you need to do.
You already posted the full security deposit charge for the new lease when you created it, and then you posted the payment on the new lease for the transfer of what was left of the security deposit on the old lease.
The difference gets added to the outstanding balance of the lease. When your tenant pays for this outstanding balance, the rest of the security deposit charge is paid off and the deposit is recorded as being paid in full on the new lease. Easy!
Note that when you perform reconciliation for this bank account, even though the DoorLoop transactions recording the security deposit transfer won't match any transactions from your actual bank account, you can still select and reconcile them because the amounts balance out. The refund on the old lease equals the payment on the new lease, so the impact on your bank balance is $0.
Next Steps
End the old lease when all move out procedures are complete.