Security Deposit Insurance – Aster National

Security Deposit Insurance

No Security Deposit Required. No Hassles.

As an Investor or Property Manager, filling units with good tenants and protecting your assets are always top priority.
Technology has made filling units faster and easier than ever before with online listings, instant credit & background checks, eSignatures and more.

However security deposits have been the long-standing tradition for protecting leases
from default of rent or tenant caused damages and very little has changed over the years. While these deposits provide protection, they also come with various complications and difficulties.

Tracking the funds and what gets taken out of them requires additional accounting and potential tenant disagreement on the deposit can result in arguments and even potentially end up in court.

Additionally, every state has various rules and regulations on how deposits are to be held, tracked, and what can be taken out of them. Some states require funds be held in special escrow accounts with interest paid to the tenants. And some states require thorough documentation be provided to the tenant on what gets taken out of the deposit. All this must be completed within 14 days in some areas. Add to that the rapidly rising cost of living and rents across the country skyrocketing increasing the out of pocket cash needed by tenants sparking a push for affordable housing in some markets and difficulty filling units in others.

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Security Deposit Insurance, A New Concept

Security deposit alternatives are a fairly new concept to the real estate investing scene. With more and more homes being turned into rental properties and the newer generations leaning more towards renting than owning, the rental market is rapidly growing.

Yet rapidly increasing inflation and rising rents are making affordable housing an ongoing issue. Security deposit alternatives are a new solution to that problem and provide for the protection of the property at a fraction of the cost.

Add to that the fact that legislative bodies across the country are considering and even passing laws mandating that alternatives be provided as an affordable housing option to tenants making security deposit alternatives increasingly popular among investors.

Security deposit alternatives are also a powerful tool for filling vacant units while protecting investors and making significant differences in “lease-up” situations.

Increase Your NOI & Revenue

Allowing for the tenants to pay for the premium opens doors to an additional source of revenue for Investors and Property Managers.

The insured can either collect the annual premium from the tenant up front or put it into monthly installments by adding it to the rent, thus increasing the NOI.

Simply put, investors and property managers can use the program to fill units faster, make more revenue, help tenants, and all while having the same protection of a deposit.

Insurance vs Bonds

Security deposit insurance differs from other products on the market in that it is a true insurance policy. Many similar products are bonds which are purchased by the tenant. Bonds operate differently in that they are a protection for the investor that will pay out in the event of tenant defaults or damages, but the bonding company will then collect from the tenant any amount paid out.

While this can be workable for many people, this can result in other issues such as:

  • Tenants who default on rent usually do not then have the money to pay back the bond company, resulting in further defaulting of rent.
  • Many tenants do not understand how bonds work and do not know that they will go into a collection process creating a potential legal issue.
  • Claims can be made against bonds which might otherwise not be collectable from a security deposit and can put tenants at risk of having to pay additional funds.
  • Some bonds come with pooled funds which can result in limits to the total amount of claimable fund
TESTIMONIALS

Hear what our satisfied clients say about us.

Brandon W

Real Estate Investor

“Aster National has proven to be a welcome upgrade for my small business’s insurance needs. They are helpful with exploring coverage options and their Customer Service is top notch.”

Jean M

Landlord

“Working with Aster was smooth, effortless and fast. I got excellent coverage within the same day”

Becka G

Owner

“I shopped everywhere for rates and Aster came through with with an amazing offer. I was able to get significantly better coverage at a much lower rate.”

(800) 805-1070