After you’ve found the perfect apartment, filled out a rental application and agreed to a background and credit check, you will hopefully know that the landlord has agreed to rent you the unit. Then, in addition to signing your lease agreement, you’ll probably also be asked to provide a security deposit. Here’s what that means, why property managers request it and how you can make sure to get it back when you move out.
What is a security deposit?
A security deposit is a sum of money given to a property manager or landlord that’s intended to secure the apartment and then pay for any damages or property loss while you’re living there. Tenants pay a refundable or non-refundable amount — often equal to one month’s rent — before moving in as proof that they intend to move in and care for the unit. Basically, this money protects the landlord or property owner in case you damage their unit or fail to pay rent.
Depending on where you live, state laws regulate where your security deposit is held — maybe a bank account that might collect interest.
When is a security deposit used?
Security deposits fix or replace items in a rental unit that got broken, damaged, stolen or lost by the tenant. For example, if you cause a flood that damages the hardwood floors, your pet ruins the carpeting or you broke a window playing baseball in the apartment, the landlord can use your security deposit to pay for repairs.
Your landlord can’t use your security deposit for routine maintenance and normal wear and tear. For example, if the apartment included a 20-year-old refrigerator that stops working while you’re living there, the landlord is responsible to replace or repair it — not you.
If you break your lease agreement and move out early, your security deposit will cover any remaining rent payments due.
It’s best to make a separate payment for your security deposit and ask for a receipt. The landlord keeps your security deposit until you move out. If they inspect your unit and find it in good condition, your deposit is usually refunded. In some cases, a landlord may allow you to apply the security deposit to the final month’s rent if state law allows that. Rules regarding your security deposit can vary depending on your lease agreement and local landlord-tenant laws.
[contextly_auto_sidebar]
How much does a security deposit cost?
Each state sets security deposit limits on how much landlords can charge tenants. It can vary from one to three months’ rent. The amount might depend on how many people will live in the unit, how old the renters are and how long the lease agreement is for. Most of the time, buildings with higher monthly rates and more amenities charge higher security deposits.
Property owners can charge a higher security deposit if they have concerns about a tenant. For example, people with lower credit scores are more likely to miss a monthly payment, so a landlord may increase the amount owed as a security deposit to cover late or missing rent. Some property managers could charge a higher security deposit if a background check reveals a criminal history.
How do you get your security deposit back?
If you’ve paid your monthly rent on time and have taken good care of your rental unit, you will usually get your security deposit back when you decide to move out. However, if the property manager determines your place needs a deep clean and your walls need repainting because you’ve damaged them, you might not get your money back. Your landlord can deduct part of your security deposit for damages, unpaid rent or utilities or breaking the lease early.
Make sure to read your lease agreement carefully before you sign it to confirm that your security deposit is refundable. In some cases, a property management company won’t return your security deposit, so it’s important to ask about that before you agree to move in.
How long do you have to wait before getting your security deposit refunded?
You might need to wait two weeks or up to two months after you move out before getting your security deposit back. That’s because it could take time to assess the condition of your apartment and any damages you may have caused. If your landlord decides to use part or all of your security deposit to cover repairs, you will typically receive an itemized list of costs. If your property manager refuses to refund your security deposit even though you left the unit in good condition, you might be able to sue in civil court.
Take care of your rental so you get your money back
The best way to make sure you get your security deposit refunded is to keep your unit in good condition. Read your lease agreement to see what’s expected of you before you move out. If you hung pictures, patch up the holes in the walls before you leave. Give the proper notice before moving out — again, check for that information in your lease — and clean your place thoroughly before you go. This way, your landlord will have no reason to keep your security deposit.
A security deposit is one of many expenses that you’ll pay when moving into a rental unit — which include application fees and first- and last month’s rent — so it’s smart to save up enough money while you’re searching for a new apartment.
