Security Deposit Laws: A Practical Guide for Landlords
Security deposits can be a legal minefield. This guide explains common rules for maximum amounts, timelines, itemized deductions, interest requirements, and documentation best practices—plus templates to standardize your process.
Jennifer Lee
While specifics vary by jurisdiction, most regions follow similar principles for collecting, holding, and returning security deposits.
1. Collection Limits and Storage
Many areas cap deposits at 1–2 months’ rent. Some require holding funds in a separate, interest-bearing account.
2. Move-In/Move-Out Documentation
Use a detailed checklist with photos at move-in and move-out. Share copies with tenants and keep records for compliance.
3. Timelines and Itemized Deductions
Return deposits within the legally required window and provide a clear, itemized list of any deductions with receipts.
4. Avoid Common Pitfalls
- Charging for normal wear and tear
- Missing the deadline to return funds
- Failing to provide written itemization
FAQs
Do I have to pay interest on deposits?
Some jurisdictions require it. Check local law or consult an attorney.
Can I charge a non-refundable cleaning fee?
Rules vary. In many places, non-refundable fees are allowed if disclosed—but they do not replace deposit rules.
About Jennifer Lee
Real estate attorney specializing in landlord-tenant law.