Obligo: A Better Security Deposit Alternative

As the only credit-backed security deposit solution, Obligo’s mission is to build trust between properties and renters through financial technology.

We’d like to share our thought process and core values that have helped us create the most effective and transparent deposit alternative on the market.

What is the Obligo's Goal?

There are very good reasons why property owners require security deposits. Maintaining protection against damages and unpaid rent is the obvious reason, but security deposits also allow landlords to screen and establish accountability with renters – they now have skin in the game.

Many renters are surprised to learn that landlords aren’t big fans of security deposits. Accepting, processing, and refunding them is a burdensome administrative process, made even more complicated due to ongoing regulatory changes.

At Obligo, our goal is not to offer an exemption for damages, unpaid rent, or unqualified renters. Our role as a credit-backed deposit solution is just the opposite: to qualify a renter for flexibile options for fulfilling security requirements and maintaining that renter’s accountability.

We built a solution backed by a super responsive customer service team. For renters, we unlock the cash that would otherwise be tied up in escrow accounts so you can save, invest, or pay down debt. For property owners, we provide security while maintaining accountability, strengthening your relationship with your renters, eliminating administrative work, and increasing your NOI.

How it Works

The hospitality industry successfully solved their cash deposit problem decades ago by utilizing financial technology, specifically by placing a pre-authorization hold on a guest’s credit card upon check-in.

For hotels, the card issuer fulfills several roles. First, they verified the credit-worthiness of a guest prior to issuing their card. Second, they provide the hotel with access to funds from a credit card or bank account balance in the event of an open balance at check-out. Third, the card issuer will act to recover debt from the guest if necessary. This process allowed hotels to simplify how trust is established, without needing to accept cash, take on new risk, or sacrifice customer accountability. This was the inspiration behind our approach.

To qualify for Obligo, we require that renters provide one or more payment methods (i.e., a bank account or credit card). We connect to these accounts in real-time to ensure that a renter would have the ability to repay any end-of-lease charges.  In exchange for a nonrefundable fee to Obligo, qualified renters keep their cash throughout the duration of the lease.

That payment on file then enables owners and managers to charge renters up to the established deposit amount at the end of their lease. Property managers can only charge up to this amount for damages or missed rent, and unreasonable charges may be disputed through any of the same legal channels as defined in the lease and/or provided by law, just like a traditional security deposit.

When a property manager submits a charge at move-out, our platform will initiate your ACH payment immediately, and then collect the owed amount from the resident. Renters who have outstanding charges at the end of their lease can schedule an interest-free repayment plan, with the option to pay in monthly installments.

We believe in providing flexibility, adding real long-term value, and providing a great experience for renters, property managers and owners alike. If a renter prefers to pay a full, refundable deposit, they are able to do so to Obligo as well.

Full Protection. Full Accountability.

Transparency and accountability are our top priorities, for both renters and property owners. What good is a security soluition if renters are unsure about their accountability, and property owners are unable to understand pricing, coverage policies, and claims processes? Historical alternatives such as surety bonds are often confusing and provide only limited protection to both renters and owners.  

We maintain transparent protection for both renters and property owners. They payment methods on file provide properties with guaranteed protection up to the security deposit amount, as specified by the lease agreement at move-in.

Obligo will never process charges that exceed a renter’s pre-determined security amount. (This does not exempt renters from additional charges they may owe to their property manager beyond their security amount.)

Obligo is committed to working with trusted owners and property managers. We evaluate partner portfolios for abnormal charge rates prior to and during our working relationship to ensure renters are treated fairly. Any patterns of renter abuse will prevent or result in a termination of the Obligo partnership.

Cost-Effective & Customized Pricing

Obligo charges a personalized non-refundable fee for each Obligo plan, except the Full Deposit option. This fee is priced monthly, and typically paid upfront for the first year of the lease. The fee is customized based on the security requirement and the renter's individual financial profile.

This fee can be charged to the property manager, the renter, or a combination of both, depending on how the property manager wishes to configure the service.