Security deposit

What It Means

A security deposit is money a tenant pays the landlord when a lease starts, which the landlord holds in case of unpaid rent or damage. HUD's model lease for the homes it subsidizes shows the usual shape: at move-out the landlord returns the deposit, plus interestInterest rateThe yearly percentage a lender charges for borrowing money, not counting fees; the APR adds certain fees to show a fuller cost. See more where it's owed, minus unpaid rent and damage beyond normal wear and tear, with a written list of anything taken out. How much a landlord may collect, whether interest is owed, and how quickly the money must come back are set by state and local law.

How People Say It

• "First month, last month and a security deposit."
• "They kept $300 for the carpet, and it was like that when we moved in."
• "Did we ever get the itemized list back?"

The Breakdown

Worked example. Sam paid a $1,500 deposit (example numbers). At move-out the landlord's written list shows $200 to repair a hole in a door and $50 for a key that wasn't returned. No rent is owed.

What the result means. Each deduction should match something on the written list, and normal wear and tear from living there isn't a deductibleInsurance deductibleThe part of a covered loss you pay yourself before your home, renters or auto insurance pays the rest, set as a dollar amount or a percentage. See more charge under HUD's model lease. If a charge looks wrong, ask for receipts or photos, and compare it with your own move-in record.

Getting it back, Buhata's suggestion

1. Walk through the home with the landlord at move-in, photograph every room, and keep a signed copy of any condition form.
2. Pay rent in a way that leaves a record.
3. At move-out, clean, return every key, photograph each room again, and give a forwarding address in writing.
4. If the deposit or list doesn't arrive by your state's deadline, contact the landlord in writing and then your state's consumer protection office.

Good to Know

Federal fair housing law applies to deposits too. HUD says a housing provider can't set different lease terms, such as a higher deposit, because of race, color, national origin, religion, sex, familial status or disability, and can't require a fee or deposit for you to keep an assistance animal. If a landlord charges you a larger deposit because of a tenant screening or credit reportCredit reportA record of how you've borrowed and repaid, kept by credit bureaus and sold to lenders, landlords, insurers and others who decide whether to deal with you. See more, the CFPB says they must tell you, name the company that supplied the report, and let you know you can get a free copy within 60 days and dispute errors. Deposit limits, return deadlines and interest rules come from your state, so check your state attorney general or state housing agency.

Related Terms and Categories

• Tenant rights

  The legal protections renters have, from federal fair housing and tenant screening rules to state and local laws on matters such as security deposits.

• Renters insurance

  A policy for tenants that pays to repair or replace their belongings, covers liability for harm they cause others, and pays extra living costs after a covered loss.

• Moving checklist

  A list of jobs to finish before, during and after a move, from checking the mover's registration to forwarding mail, so nothing important is missed.

• Home inventory

  A room-by-room record of what you own, with photos, values and receipts, kept to prove a loss to your insurer after a fire, theft or storm.

• Change of address

  Telling the Postal Service, the IRS and everyone else who writes to you that you've moved, so mail is forwarded and official records follow you.

Planning and life admin