What Is a Rental Deposit?
When a house or apartment is rented, a landlord usually collects in advance a rental deposit, also called a security deposit, to pay for any damage the tenants might do, to make up for unpaid rent, or to cover certain other expenses.
How Much Can a Landlord Demand as a Rental Deposit?
A landlord cannot ask for more than two months’ rent as a security deposit. Of course, rent is generally paid in advance, so a tenant could have to pay one month’s rent plus an amount equal to two months’ rent as a deposit, just to move into a unit.
What Does a Landlord Do with the Rental Deposit During the Time the Tenant Is Renting?
A landlord must keep the rental deposit in a federally insured account, and must keep the deposit money completely separate from the landlord’s own money. The special account the deposit is put in may be an interest-bearing account. If it does bear interest, the landlord gets to keep any interest earned on the deposit for the first five years of the rental agreement. Any interest earned after that is the tenant’s.
When Can a Landlord Keep Part or All of a Tenant’s Deposit?
The law says a landlord may keep part of the rental deposit for the following reasons:
- To make up for unpaid rent or other payments owed to the landlord under the rental agreement.
- To make repairs to the property for damages that were the tenant’s fault. Ordinary wear and tear is not included in such damages.
- To pay for the costs of removing a tenant who remained in the house or apartment even after proper notices to leave were delivered, based on the tenant’s not living up to his or her end of the rental agreement.
How Can I Make Sure of Getting My Rental Deposit Back When I Move Out?
Here are some tips on protecting your rental deposit:
- Get a receipt when the deposit is delivered to the landlord. The receipt should say it is for a rental deposit, and should say the amount and the date received.
- Make a list of any damages already there when you move in. This list should be made right when you first move in, or before. The landlord should help you make the list if possible, and it is a good idea to have a friend of yours there, too, as a witness for later. It’s best if the landlord and tenant sign the list, and each keep a copy. Take pictures of any damage.
- Tell the landlord about damages that occur while you’re renting there. The landlord should be informed right away, in writing if possible. The cause of the damages should be explained. Remember that the tenant is responsible only if the tenant is somehow at fault.
- Give the proper notice when you want to move out.
- Give the landlord a mailing address at the time you move out, or before. This can be your new address, or the address of a friend — wherever you want your deposit sent. Give the address to the landlord in writing, and keep a dated copy of the paper you give the landlord, for your own records. If no mailing address is given to the landlord within one year, the tenant loses the right to get any of the deposit back. (A tip: If you’re moving a long distance away, you may want to give the landlord the address of a trusted local friend to send the deposit to. Some landlords might be tempted to keep the deposit unfairly if they think it is going to be too inconvenient for you to take them to small claims court.)
- Put the place back in shape when you move out. This means removing the trash and leaving the house or apartment in the same condition it was in when you moved in or better. Of course, normal wear and tear is permitted, and need not be fixed or restored.
- Arrange a meeting with the landlord at the time you move out. Go through the checklist you made when you moved into the apartment. Try to get your landlord to say whether you are going to be charged for any damages, cleaning, or whatever. That way you may be able to fix whatever problem there is while you’re still in a good position to do so. If the landlord can state no reason for keeping part or all of the deposit, try to get the deposit back at this meeting.
How Soon After I Move out Should I Get My Deposit Back?
After a tenant has moved out and left a mailing address, the landlord has 30 days to either return the deposit or give the tenant a written explanation of exactly why the landlord is keeping some or all of the deposit. The explanation should be very specific, and if the landlord is keeping some of the deposit because of damages to the property, those damages and the cost of repair should be clearly listed.
What If I Don’t Agree with the Landlord’s Reasons for Keeping My Deposit?
A tenant who doesn’t think the landlord’s reasons for keeping the deposit are good reasons can tell the landlord so, and then take the landlord to small claims court if no understanding can be reached.
What If the Landlord Doesn’t Return the Deposit but Doesn’t Give a Written Statement of Reasons for Keeping It, Either?
If 30 days go by from when the tenant moved out and gave a mailing address, and the landlord doesn’t perform the legal duty to give the tenant the deposit back or a written statement of reasons for keeping it, the landlord “forfeits” (loses) the right to keep the deposit. The point is that a tenant has a right to be told in writing and within 30 days what is going to be done with the money.
What Happens to a Landlord Who Purposely Keeps a Rental Deposit Without Any Good Reason?
A landlord who violates these laws and keeps a rental deposit in bad faith (knowing there is no good reason to keep it) can be ordered by a court to pay the tenant for whatever harm was done to the tenant plus a penalty of up to two months’ rent.
If a Tenant Has a Lawyer Help in a Lawsuit over a Rental Deposit and the Tenant Wins, Can the Landlord Be Forced to Pay the Tenant’s Attorney?
Yes. In any lawsuit over a rental deposit the court can make the loser (landlord or tenant) pay the legal fees of the winner’s lawyer.