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Is The Deposit Refundable in Assisted Living Facilities?

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Home » The Deposit  
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The Deposit Isn't Refundable?
Assisted Living Directory iconWritten By: - Founder/Editor for Assisted Living Directory
Summary: Many assisted living facilities will require a deposit to secure a spot for you or your loved one. Often times, to the surprise of the potential resident or family, this deposit is not refundable.

There are some things in life that are just a given - things that we just accept that will happen, whether we like them or not. Taxes are a great example. Every year, we pay them diligently while we often grumble that the government is taking too big of a bite.

Another lesson learned in the "things to expect in life" category would be that if you reserve something with a deposit - that deposit is probably not refundable if you change your mind. The idea that a company will take your money, even if no services are rendered simply baffles many people.The deposit may not be refundable

When we recently read an article about an Arizona family wanting their deposit back that they paid to reserve a space for their elderly mother at an assisted living facility. "A Valley family says they need help getting a cash deposit back from an assisted-living facility so they contacted 3 On Your Side for help" the article begins.

This is an emotional issue for sure, and having to put any parent or loved one into an assisted living or care environment can be one of life's biggest emotional challenges. As we all know, during times of stress or heightened emotion, we don't always think clearly, or take the time to ask the proper questions, to read the fine print, or to ask for something in writing.

Unfortunately and very sadly for this family, their mother died before being able to move in, and after they paid the deposit. Now the family wants their $500 deposit back. The facility said that the deposit would hold the room for 2 weeks, and a week into that period, the unexpected and unimaginable happened with the mother's passing.

A family member was quoted as saying ""They should have told us up front that it was non-refundable and I think we would have certainly questioned that and said, 'Well, what if for some reason she can't occupy?'"

The owner of the assisted living facility went on to say that Ross and his family knew the deposit was non-refundable.

Our Take:

What exactly is a deposit? One definition we found says that a deposit is "a payment given as a guarantee that an obligation will be met." The facility in question had an obligation to hold the room for the 2 weeks. By holding this room, however, they may have passed on another potential resident moving in, and thus lose money by keeping the room vacant in hopes that the resident who paid the deposit will move in. This is exactly why they would go through the trouble to collect a deposit - to protect themselves from loss. The family did not keep their obligation to occupy the room

A person paying a security deposit for an apartment who breaks their lease will most certainly lose most of, if not all of that deposit - because an obligation was not met.

We feel that it is the responsibility of any person, facility, or any other company who collects a deposit to, in writing, make very clear whether the deposit is refundable or not refundable. We also feel that it is the equal reasonability of the person paying the deposit to ask the appropriate questions about the deposit, and to get in writing the terms and conditions of the deposit, signed by the owner or manager of the company or facility in question. Simply taking someone's word for it is not sufficient, and will most certainly lead to conflict and misunderstandings.

We also feel that if the discussion as to the "refundability" of the deposit did not take place, then the assumption has to be made by the persons paying the deposit that it is not refundable, and that they will not get their money back if they change their mind or default on the agreement.

Often times, it is the knee-jerk reaction of the media and the casual observer that it is the "company" that is being "evil" and taking advantage of the consumer. It is much easier to take this view if there are emotional issues involved such as the one described above. However, for any company to be successful, they must take certain measures to make sure that they don't incur unnecessary losses. We believe that this is absolutely reasonable, but that it must be done within the boundaries of the law, and it also, for the sake of everyone involved, must be in writing, and agreed to by both parties...signed and dated.

- Assisted Living Directory

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Responses to this article:
Doris Wrote:
I want to know what is the legal amount an assisted living facility can keep from a deposit when the move in was cancelled. My friend gave $2400 deposit for a board and care. The monthly rent for care is $3000. She found out the place had many many violations so she backed out of the deal. I was told, per title 22, that the facility can only legally keep $500 and must refund the rest. I have researched and can't find the answer. Hope you can help. Please email the answer Doris
26 January 2017 at 1:14 pm

Liz Wrote:
I just found out about this practice. Basically the facility requires a security deposit that is refundable with 30 day notice of one moving out. Who knows they are going to die in 30 days? It might be legal but I think it is highly unethical. Another item to add to the list of Buyer Beware.
11 January 2017 at 1:13 pm

Kathy Wrote:
On April 29 my mother was moved from an assisted living facility to another that provided dementia care. She ran away from the first facility and the director there arranged for her transfer to the second. The director at the new place came to mom's old room and we completed the paperwork there. I was in tears. I really though she was doing well. I was so hurt when she ran away and I understand why she could not stay there since they were not a memory care unit. The monthly fees at the new place were $6,000 (almost double what we were paying) and I had to give them an additional $6,000 deposit the first month. On 4/18 she was admitted to the hospital and passed away on 4/26. We removed all of her belongings on 4/28. Now more than 2 months later we still have not received our deposit. We paid a total of $18,000 and she was there less than 2 months! Kathy
6 July 2016 at 1:12 pm

Beej Wrote:
my mom did not pay a deposit, but did pay one months rent in full. She died mid month. we contacted the assisted living facility and requested a refund for remaining two weeks. We feel our notice provided what is reasonable notice to lease apt to another person. to date we have not heard back from home as they say this has never happened before. is there recourse or do we just write off the full rent? Beej
7 December 2015 at 2:18 pm

David Wrote:
Cherie, sounds like an awful experience - I would say get in touch with your local Long Term Care Ombudsman - they are there to investigate things like this. Sounds like you have a good argument.
11 February 2014 at 8:25 am

Cherie Wrote:
I understand the reason for the security deposit but if you are unable to give 30 days notice out of fear that your elder mother is in jeoperty or getting deathly sick because of irresponsibility should you still have to pay. The caretaker at my mothers ALF was severely sick with a cold. I offered to take my mother home for a week because the caretaker would not go to the doctor, would not wear a mask or wash her hands. After my sister and I got sick and my great granddaughter ended up in the hospital for a week, we had some words about her taking care of elderly when she was so sick. She became very nasty and she lied to me about going to the doctors and said it wouldn't matter because my mother was on medication for a bladder infection and it would clear up any cold she would catch. The day after my mother fell out of her wheelchair and was severely hurt. There were no witnesses and they said she was always leaning over and accidents happen. If that was true, why didn't they put something in front of her so she wouldn't fall. Doesn't make sense. They refused to give back the deposit and said she was not unsafe. I have pictures and she looks like she was beaten. She was crying for weeks to come home and they were hurting her. She has dementia, but I believe even with dementia they recognize fear. Do you feel the deposit should be returned because I had no choice to remove her? My phone number is 727-224-2509 Cherie
11 February 2014 at 8:24 am

Jackie Wrote:
I really don't understand people who want to get a deposit back after they have broken, as you say in the article, their obligation. That's exactly the point - the business has lost potential revenue by holding a spot. It's only fair!
18 January 2013 at 8:14 am

Horace Wrote:
It sort of sucks tht we have to read the fine print so much nowadays. I don't have time to read everything!
21 June 2012 at 4:12 pm

Laura Wrote:
Definitely get the paperwork for the facility to review beforehand, and make sure you are clear on this. Any facility that doesn't allow you to review the paperwork first is probably one that you shouldn't consider.
15 November 2011 at 8:12 am

Pauline Wrote:
My Mother moved into Aegis Senior Living in California and had to pay a "Pre-Admittance Fee" equal to one month's rent that was said to be partially refundable after moving out, in incremental stages, with no refund after 25 months of occupancy. Is this legal? This is basically a staged non-refundable Security Deposit.
Jo Sciarroni
2 October 2009 at 10:15 pm

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