New York couple pays a $600 security deposit before being allowed to see the lease, backs out after spotting red flags, property manager refuses to return the money: 'The unit was taken off the market'

Author image for Cata Holmes
Cata Holmes • Writer
Jul 19, 2026 12:00 PM EDT

Should future renters have to pay before they are allowed to read a lease?

A couple found a beautiful townhouse they wanted to rent, and immediately contacted the landlord. The man asked to be paid in advance the $600 security deposit fee, as well as $300 for a pet fee, before sending them the lease. When the couple got the paperwork, they backed out since the lease was full of red flags and strange things. The landlord, however, is refusing to return the deposit since the property was taken off the market, and the money was to make up for the lost time.

Now, we all know every state is different, and some things change when it comes to renting a property. However, nothing sounds as strange as this fake security deposit that's not refundable because the house was taken off the market when the couple showed interest. In most cases, the money is sent once people can read the lease and agree to it. Not the other way around.

The thing that I found to be the weirdest is that the landlord states that keeping that amount of money "is common practice" when renting properties, a thing that the renters never heard about. Also, they had to pay to read the lease and didn't sign a thing that could lead them to lose that money. They followed the instructions that the landlord said, and found themselves in this crazy situation.

The community in r/Renters was helpful and gave the couple some good information on how to proceed. Most of them confirmed they should go ahead and contact a lawyer to have this situation legally reviewed since there's nothing that could prevent them from recovering the money. Scroll down and find out what happened.

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  • 01
    For-rent sign displayed outside a residential property available for lease.
    via Unsplash+ (via Ruliff Andrean)

    For-rent sign displayed outside a residential property available for lease. 

    Scene does not depict actual individuals or events.

  • 02
    Hi everyone, looking for some legal advice on a "security deposit" withholding. I live in NY and my girlfriend and I saw a townhome we liked in a small complex neighborhood. We toured it and talked with the property manager. We sent in applications and got approved. To see the lease, we needed to send a $600 security deposit and $300 non-refundable pet fee. After sending in the money and getting the lease we started to see some shady things (typical landlord).
    via Quazol
  • 03
    - Some extra charges - Wording we don't like that could cause problems
    via Quazol
  • 04
    Overall a lot of things we don't like and made us realize this isn't the place we want to live, especially with other challenges that could happen.
    via Quazol
  • 05
    We reached out saying we don't want to sign the lease and withdraw our application and asked for our security deposit and pet fee back. This was his response; "As a courtesy, I'm able to refund your nonrefundable pet fee. However, the security deposit is nonrefundable. It is common practice for security deposits to be nonrefundable once they are paid because the unit is taken off the market."
    via Quazol
  • 06
    I am utterly confused by this and have never heard this before. I don't remember seeing or hearing anything about it being nonrefundable. We also had to PAY to see the lease. In the lease it says they may hold it during the tenancy, but we never signed anything or moved in. Any advice or anyone know NY law/renters protection about this?
    via Quazol
  • 07
    (Also for reference, we sent the payments on Friday and got the lease. By yesterday (Sunday) we emailed our concerns and asked for money back. It was off for a day or two and isn't available until Oct 1st.)
    via Quazol
  • 08
    EDIT: Appreciate all the advice so quickly! For clarification, nothing was signed. The money sent in was before we were sent the lease. In the lease, it says they can withhold it during the tenancy... (and can be used if we damaged it) but we never signed or lived there.
    via Quazol
  • 09
    We will definitely be sending a letter back and threatening further action (small claims) possibly police if you think it is best.
    via Quazol
  • 10
    Prospective renters meeting with a property manager during an apartment showing.
    via Unsplash+ (via Faruk Tokluoğlu)

    Prospective renters meeting with a property manager during an apartment showing. 

    Represented by models.

  • 11
    JoeCensored You can sue in small claims for the security deposit. They have to be refunded. In the future never pay anything other than maybe a small application fee before signing the lease.
    via Quazol
  • 12
    ChutneyWhatney So you didn't sign the lease, right? Did you sign anything re: the pet and security deposit? If no, LL is full of it and you get everything back. If he continues to withhold, you may be able to sue him for 2x the amount, etc.
    via Quazol
  • 13
    Whpsnapper Never pay money until you sign the lease. You will have to sue this scumbag landlord to get your money back. Before filing, send the scumbag a letter stating your intent to sue if the deposit isn't returned, maybe they'll cave.
    via Quazol
  • 14
    MrSoftShoe "It is common practice for security deposits to be nonrefundable once they are paid because the unit is taken off the market." Please respond and tell him it's common practice to haul him to court for fraud. That's not common at all.
    via Quazol
  • 15
    MarleysGhost2024 Small claims court.
    via Quazol
  • 16
    23 MysticTruths can you contact your bank and cancel the payment?
    via Quazol
  • 17
    Icy-Tangerine-9936 Absolute bulls. You don't have a contract . and he can't keep the money. Tell him you want a check in 24 hours or you are calling the police and reporting the theft and fraud. Get your money. Report it anyway. He's a criminal and who knows how many people he's scammed.
    via Quazol
  • 18
    Person holding cash while making a payment or deposit.
    via Unsplash+ (via Sasun Bughdaryan)

    Person holding cash while making a payment or deposit. 

    Image shown for illustrative purposes; person depicted is a model.

  • 19
    wedontliveonce They said you were required to put down a non-refundable security deposit just to SEE THE LEASE??? Red flag. You got scammed. That's illegal. Tell them you are contacting your attorney general and will see them in small claims.
    via Quazol
  • 20
    Bastillerion Tell him he has 3 days to return your money or you will be pursuing criminal charges against him for larceny.
    via Quazol
  • 21
    ThoriatedFlash A legit landlord shouldn't take the unit off the market until a lease is signed. If they take it off the market and lose money because they have to relist it or whatever, that is their problem not yours. This does not give them justification to keep your security deposit and they are being shady AF.
    via Quazol
  • 22
    RSTaylor If they clearly labeled this as a security deposit then they owe you this back. Especially as no lease was executed. I'd say the same with the pet deposit. You need to check NY state law, but I don't think they have a leg to stand on.
    via Quazol

  • Stories like this are a reminder that sending money before reviewing all the details can be a costly mistake. Whether you're renting an apartment, signing a contract, or making any major commitment, it's worth slowing down and reading everything first. A little caution upfront can save a lot of frustration, stress, and money later.

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landlord new york money Renters security deposit
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