Security Deposit Laws

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Requirements and Limits of Security Deposits

Putting down a security deposit before you move into a rental unit is standard practice.  Every state allows landlords to collect a security deposit when a tenant moves into a rental unit. A security deposit is advance payment required by a landlord from a tenant to cover expenses of any repairs or damages to the unit that are greater than “normal wear and tear.” It can also cover the cost of cleaning the unit when the tenant moves out, but only to make the unit as clean as it was when the tenant first moved in. The general purpose of a security deposit is to assure that a tenant pays rent on time and keeps the property in good condition.

Are There Limits on Security Deposits?

Even though every state allows landlords to collect security deposits, most states have limits. California, for example, only allows a landlord to collect two months’ rent as a security deposit if the residence is unfurnished, and three months’ rent if the residence is furnished. California landlords are also permitted to add an extra half month’s rent if the tenant has a waterbed. Massachusetts also allows landlords to collect two months’ rent in advance. Arizona and New Jersey allow landlords to collect one and a half months’ rent. On the other hand, Florida, Illinois, New York, and Texas have no limitations on security deposits.

Can a Landlord Collect an Additional Security Deposit for Pets?

Landlords have the right to prohibit or restrict the type of pet that can reside in their rental unit. However, pursuant to the Fair Housing Act, landlords cannot refuse to rent to someone with an animal that is a service or comfort animal. Can landlords collect an additional deposit for pets?

In most states, yes, landlords who allow pets may require tenants to pay a separate deposit to cover any damages caused by the pet. In other states, a security deposit for a pet in a building that allows pets is not legal. That being said, in all states, it is illegal to collect a pet deposit for a service or comfort animal.

It is important to note that even if the state allows a landlord to collect a separate pet deposit, it might be a bad idea to collect a pet deposit. Let’s say a landlord has a tenant who has a well-behaved dog, but the tenant causes substantial damage to the unit. A landlord is not permitted to deduct the pet deposit if the pet did not cause the damage, so the landlord cannot “dip” into the pet deposit to cover expenses incurred by the tenant. Instead, the landlord might consider charging a higher rent to a tenant who owns a pet in order to repair any damage the pet may cause in the future.

When Must a Security Deposit Be Returned?

After repairs are made beyond “normal wear and tear,” the landlord must return any unused security deposit to the tenant with an itemized statement of deductions. In other words, the landlord must account for all the deductions made from the security deposit. This ensures the landlord is not arbitrarily deducting from the deposit and keeping the money.

A tenant’s security deposit must be returned within a specific time, typically between 14 to 30 days. In Arizona, the landlord must return your security deposit within 14 days after the tenant has moved out. California gives landlords an extra week (a total of 21 days) to return the tenant’s security deposit. Under New York law, a landlord must return the tenant’s security deposit within a “reasonable time” after the tenant has vacated and returned the keys to the rental. “Reasonable” is generally considered anywhere between 21 to 45 days.

What if Your Deposit is Returned Without Itemized Deductions?

If your landlord returns your deposit without a list of deductions, you should immediately request an itemized statement. The list should include the time spent and the hourly rate charged, and must also describe the work performed. If you disagree with your landlord’s deductions, you can contest any or all of them. In that instance, you may need the help of a real estate attorney who is familiar with landlord-tenant law in your area. 

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Last Modified: 03-07-2016 11:29 AM PST

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