Property Manager filed Bankruptcy, is our Deposit in trouble?

Question

We gave our 30 day notice to move out, and only after not getting a reply have I discovered that the property manager is not contactable (phone numbers don't work, websites are down and office is empty) -- After doing a bit of digging we've discovered that the property management company has filed for Chapter 7 bankruptcy. However, we recieved no notice of this, and we would very much like to get our deposit back, is there a way to do this? I have only ever dealt with the property managers, though I was given a name of the 'owner' when we originally moved in so that I could deal with the HOA (who only has the property manager's contact information, unfortunately) I tried searching the name and came up with only dead-ends... ANY help would be greatly appreciated...

Answer 1

It shouldn't be.

Most states require deposits received from rentals to be placed in a trust account.  A trust account is an account where normal operating funds are not comingled.  

These trust accounts are frequently audited by the state and heavy, heavy fines are levied for violations.

I wouldn't freak out yet until you don't get the deposit, 30-days from move out.

Answer 2

Perhaps and perhaps not.  Some property management firms hold deposits in THEIR escrow accounts and others forward it on to the actual owner of the property.  You need to see who is holding the money and where.

Good luck.