Quote Quoting rualakerhellya
View Post
My question involves landlord-tenant law in the State of: Michigan.

I am going to move out of my apartment in approximately 45 days. When moved in I was told I could pay a refundable security deposit of 1.5 times my rent or pay a one time non-refundable fee called suredeposit. The agent acting on behalf of the landlord made it sound like insurance. I pay this fee and won't get it back but it covers your deposit and damages. Now that I am about to move out and looked into it I have come to discover I unwittingly purchased a security bond for the landlord.
Unwittingly? At some point you had to sign something to get the bond. At that point it would have been laid out on paper in front of you. My guess is that you signed it without thoroughly reading and understanding what you were signing and that's dangerous.

Quote Quoting rualakerhellya
View Post
Basically I payed a small fee for a bond that the landlord will then make a claim for damages/rent/ect. on. Then they Bond company comes after me like a collection agency removing my ability to disputed or deal directly with my landlord and damaging my credit report if i do not pay it imminently.

My question are am I understanding suredeposit correctly?
Yes. That's exactly how a surety bond works.

Quote Quoting rualakerhellya
View Post
Is this type of security deposit legal in Michigan?
I can't imagine why it wouldn't be. Bonds are used for a variety of purposes. No reason they can't be used for security deposits. The company has been at it for 15 years. Bonding companies are regulated by the Department of Insurance. If you have any doubts call up and ask.

Quote Quoting rualakerhellya
View Post
Do I have any legal ground to fight this after being completely lied to by the agent acting on behalf of the landlord? Am I entitled to a damages bill before they make a claim on the bond?
No and no.

You signed a contract that allows the landlord to collect from the bonding company without having to deal with you.

The bonding company, on the other hand, should have to justify any dollars that it's coming after you for. Keep in mind that you did not post a security deposit. Your landlord waived it in exchange for allowing you to post the bond. I think that the security deposit law would not apply in this case and the bonding company would have the right to collect whatever you agreed to in the contract.