State laws cover just about every aspect of security deposits. It’s better to learn about them before making a mistake and finding yourself in small claims court. Educate yourself, act reasonably, and talk to us if you have any questions or need help.
Here are some security deposit issues to think about…
What Amount Can the Security Deposit Be?
You may charge a tenant:
- The equivalent of three months’ rent for a furnished residence and the equivalent of two months’ rent if it’s not
- If the tenant’s a service member on active duty, the security deposit can be one month’s rent if the unit’s unfurnished and two months’ rent if it’s furnished
- You can add an extra half month’s rent if the tenant still lives in the 1970s and has a waterbed
- There’s no limit for commercial property
You may not charge any nonrefundable fees.
When Do I Need to Return a Security Deposit After the Tenant Leaves?
You must return the renter’s security deposit within 21 days after the tenant surrendered the property (you got the keys back and they left).
Am I Required to Give the Tenant Information About the Security Deposit?
You should:
- Write a letter explaining why you’re withholding all or part of the deposit
- Provide an itemized list of each of the deductions
- Include copies of receipts documenting your costs, unless they’re for less than $126 or the tenant waives their right to the receipts
You’ll also need to return any remaining portion of the deposit
What Can I Deduct From the Security Deposit?
You can keep:
- The cost of fixing any damages caused by the tenant and or their guests
- The cost of cleaning the unit to make it as clean as it was when the tenant moved in
- Unpaid rent
You cannot deduct the costs of cleaning or repairing anything that would be considered the result of ordinary wear and tear.
What Is Ordinary Wear and Tear?
It’s the unavoidable deterioration of a unit caused by the tenant’s normal use. Beyond that, a repair is usually avoidable damage caused by neglect, misuse, or abuse.
Carpet worn in high traffic areas would be considered ordinary wear and tear. If it’s ripped or shows cigarette burns would not. Cleaning or replacing something with filth, dirt, or grime beyond ordinary use can be deductible.
A tenant must use reasonable care when living in the unit. This includes:
- Keeping it as clean and sanitary as the unit’s condition allows
- Using fixtures (electrical outlets, plumbing) properly
- Properly disposing of trash
- Not destroying, damaging, or defacing the unit
- Using the unit and its rooms as intended
If the tenant doesn’t live up to their obligations and there’s damage or filth in the unit as a result, that’s not ordinary wear and tear.
Can My Ex-Tenant Sue Me Over the Security Deposit?
The tenant can file legal action in small claims court if the total amount at issue is $10,000 or less. Your ex-tenant can sue you for the return of the security deposit plus twice its amount in damages if there’s enough evidence for the judge to decide you acted in bad faith. The two of you can also use a mediation program to try to resolve the issue instead of litigating it.
How Can I Avoid Security Deposit Issues With My Tenant?
Document, document, document. Take videos or photos of the unit before the tenant takes possession. Keep all correspondence (texts, emails, letters) and notes of conversations about problems with damage or keeping the unit clean. Take photos or videos of the unit after the tenant leaves.
If there’s enough documented harm to the unit in the before and after photos, it may justify deductions from the security deposit. Use your best judgment, call us if you have questions, and act in good faith unless you want to risk paying your ex-tenant three times the security deposit.
We’re Here to Help
If you’re a landlord and have questions about security deposits or need legal representation, call Anthony Burton at (949) 244-4207 or fill out our online contact form today.
