A few weeks ago a couple asked if I would hold my unoccupied rental for 2 weeks until they moved out of their current place. After vetting them out and going through the background checks I agreed and we executed a lease agreement for them to move in on 6/28. They also paid the security deposit.

Yesterday, they sent word to their agent who contacted our agent that they want to back out. They included a story about one of them breaking a leg. Now, I think it's BS and they just want to stay where they're at (I know they're current landlord wanted them to stay).

It seems clear that Texas property code states I have no obligation to return the deposit another suitable/acceptable tenant is found AND moves in by 6/28. Clearly that's not gonna happen.

Anyone else deal with a similar situation? Trying to see if I'm missing something. With an executed lease I don't see how they can come back for the deposit. I don't feel bad about keeping it considering I held it for them when I had three other prospects who submitted applications.

Yep.

Legal document. Deposit is yours. They owe you until a new tenant is placed. (If you feel like pursuing it)

Thanks y'all

Yep, they signed the lease and owe you the entire amount. Time to be an adult.

We bought our first rental property back in the early 80s and the very first couple who wanted the house said, " we are going to Mexico to give out bibles for 5 months so it will be that long before we move in." Fine, do you want to pay the rent up front or have someone locally to pay it each month? " Well, can you just hold the house for us till we get back and we can start the rent then?"

Where is the property?

Keep deposit. Send them notice that based on the definition in the lease, they have vacated and you have deducted reletting fee and unpaid rent (amount and number of months depends on notice period defined in lease). You will likely deduct more than the total deposit And they'll still owe you some amount, but you can just tell them you'll call it square if they agree to walk away.