What Is a Security Deposit? Everything You Need to Know

What is a security deposit? A security deposit is a sum of money paid by a tenant to their landlord or property manager before moving into an apartment or house. This deposit serves as a financial safeguard for the landlord, helping cover any potential damages or unpaid rent that may occur during the tenant's lease agreement. It acts as a form of protection for the property owner while providing assurance to the renter that their rental will be in good condition after their lease has ended.

This guideline help assist you in understanding:

• The purpose and significance of a security deposit
• Clarifying the distinction between a security deposit and last month’s rent
• When you pay for it and how it’s calculated
• When you’ll get it back
• Possible deductions from your deposit
• What happens if damages are more than your deposit
• What to do when you haven’t received your security deposit
• What is a pet deposit

What’s the Significance of a Security Deposit?

The purpose of a security deposit is to protect the landlord and the tenant. While most people aren’t planning to wreck and damage their home, some people will do just that. Additionally, accidents happen even to the most careful tenants and renters.

A deposit is a safeguard measure for both parties. If the tenant doesn’t damage the rental unit or the property, they’re more likely to receive their entire security deposit back from the property owner.

Difference Between a Security Deposit and Last Month’s Rent

Tenants often believe they can apply their security deposit to last month’s rent, but it’s generally not allowed unless explicitly stated in the lease agreement. 

This is a key example of asking the landlord prior to signing the lease as to whether the security deposit will go toward last month’s rent.

Keep in mind, if the property owner asks for last month’s rent and not a security deposit, that money can only be applied toward your last month’s rent, and that’s it. A security deposit provides protection for both parties from any unforeseen damage.

In the author’s personal experience, their security deposit didn’t count toward last month’s rent. They paid last month’s rent as usual, but because they left the rental unit in good condition, they received their security deposit back.

When Do I Pay for my Security Deposit?

You typically pay for your security deposit after you sign the lease agreement but before you can receive your keys and move into your new rental apartment or house.

Security deposits are paid the following ways:

• An ACH payment (electronic payment)
• A check
• A cashier’s check
• A money order

Your landlord will have their preference on how they want to receive their security deposit. In the author’s personal experience, they paid their security deposit with a check with one apartment community and with an ACH payment with a different apartment community. Again, this is something you should ask if your future property manager hasn’t already told you their preferred method.

Not always but in the author’s personal experience, you typically fill out an application, pay the application fees, wait for approval, and then once you’re approved, the landlord will ask for your security deposit.

How Much Is an Apartment Deposit?

A security deposit — whether you rent an apartment, house, condo, etc. — will depend on each state law’s along with the landlord’s personal preference. Following Arizona state laws, I’ve been charged two different deposit amounts while renting from two different property owners.

Below are some examples of state laws for security deposits, check out rocketlawyer.com.

• Arizona limits the amount to 1 1/2 months’ rent
• California limits the amount to two months’ rent (three months’ rent if furnished)
• Colorado doesn’t have any state laws for limiting the amount collected
• Florida doesn’t have any state laws for limiting the amount collected
• New York limits the amount to one month’s rent, “unless it is subject to the City Rent and Rehabilitation Law or the Emergency Housing Rent Control Law”
• Texas doesn’t have any state laws for limiting the amount collected
• Virginia limits the amount to two months’ rent

Your security deposit amount will depend on your specific situation. Unless you and another person are renting from the same place or the same property company, you’ll likely see varying deposit amounts.

When Do You Receive Your Deposit Back?

The answer is: It depends on state laws. Just like how each state has their own laws on how much a landlord can charge a tenant, state laws also dictate when a property owner must return the security deposit to the renter.

How Long Do You Have to Wait for Your Security Deposit?

As we mentioned earlier, how long you  wait to receive your deposit will depend on each state. We’ll use the states from earlier as examples for below. Keep in mind, you can visit rocketlawyer.com for the full list of deadlines to return it.

• Arizona’s deadline for return is 14 days.
• California's deadline for return is 21 days.
• Colorado’s deadline for return is 30 days if unspecified, and up to 60 days if the lease specifies
• Florida's deadline for return is 15 days, or 30 days if the landlord intents to make deductions
• New York’s deadline for return is 14 days
• Texas' deadline for return is 30 days, but the landlord isn’t required to return the deposit if the lease agreement requires written notice of intention to vacate premises and fails to do so
• Virginia's deadline for return is 45 days, but deductions must be itemized within 30 days (45 days if charges exceed deposit amount)

Some states require a receipt showing what and why they deducted money from your security deposit but not all states require it. If you’re curious as to why you lost money out of your deposit, and you didn’t receive an itemized deduction statement, reach out to the property owner.

6 Steps for a Tenant to Receive Their Security Deposit

Now, some of the responsibilities falls onto the renter before the landlord can give it back to you. Here are six steps you need to take to ensure you’re good to go on your end.

1. Give notice for your lease: Don’t know how to give notice, read the "How to Give Notice When Your Lease Is Up" article learn about the steps that you need to take. Keep in mind that your lease agreement will tell you how many days you need to give notice that you’re ending the lease from 30 days, to 60 days, to 90 days, or to 120 days.
2. Clear out belongings: Some people might say this is step No. 3, but trust me, it’s easier to document everything when all your belongings and any leftover moving trash is out of your home.
3. Take pictures and/or video: Take a thorough inventory inside and out of your home (balcony, yard, etc.) with pictures and/or video. You should’ve taken pictures and/or videos prior to moving in, so you can show what damage already occurred prior to living there.
4. Clean your home: While it’s typical that you should leave your rental place in “broom-swept” condition, it’s a vague term that’s up to anyone’s interpretation. Complete a deep clean yourself or hire someone to perform a deep clean for you. Did you know Moving Help has moving labor providers who also clean? That’s right. The same people who helped you load or unload also can help you clean.
5. Request a move-out inspection: Unless you absolutely trust your property owner 1,000 percent, you should always request to be onsite when they perform a move-out inspection. This way, you can refute any damage that was their prior, or they can give you the opportunity to fix any damage now, that way it won’t come out of your security deposit later.
6. Double check your forwarding address: When you gave your landlord your notice letter, you should’ve put in their where they can send your security deposit to your new address. Don’t have a new address yet? Let them know you’ll notify them as soon as possible. They can mail it to a family member’s address, but you’ll have to decide whether you’re comfortable with that or not. Either way, double check they have the correct address.

Once you finish these six steps, you should be good to go to receive your security deposit.

6 Reasons for Deductions Toward Your Security Deposit

Now as the tenant, it’s your responsibility not to damage your home. If damage occurs in your home — whether by you, a friend, relative, etc. — it could come out of your security deposit. This is why a walk-out with your landlord is important. They might let you fix something without the funds coming out of your security deposit.

Let’s discuss the six common reasons for a property owner to use part of your security deposit for damage.

1. Damage exceeding normal wear and tear: A part of your security deposit can go toward excessive property damage such as a broken door, broken windows, holes in the carpet, giant holes in the walls, and burn marks on the hard wood floors. A deposit can’t be used toward normal wear and tear.
2. Tenant’s failure to pay utilities: You must pay all utility bills prior to moving out. If you have any unpaid bills, your deposit will go toward paying them off.
3. Cleaning cost: If you don’t leave your place at the minimum “broom-swept” condition, they could charge you for cleaning costs. If your place is either extremely filthy or unsanitary, expect part of your deposit to go toward cleaning.
4. Unpaid rent: If you have any unpaid rent or late fees, part of your security deposit will go to the outstanding balance.
5. Early lease termination: Depending on what your lease agreement says, a property owner might be able to keep some of your security deposit if you end your lease early. Of course, you might not expect to end your lease early, but life does happen, so this is a good question to ask before signing your lease agreement.
6. Painted walls: If you painted a wall without the landlord’s permission and didn’t paint it back to its original color, you can expect part of your deposit to go to repainting to the wall’s original color.

What’s Normal Wear and Tear? Is My Deposit Applied to It?

Now, you might wonder what is considered normal wear and tear. Normal wear and tear  to the natural deterioration of a property over time due to regular use, especially use that wasn’t careless by the tenant.

We have eight examples of what could be considered normal wear and tear:

1. Small nail holes from hanging pictures or curtains
2. Fading of flooring due to sunlight exposure
3. Appliances showing aging or the refrigerator’s handle being slightly worn down
4. Faded paint or wallpaper
5. Carpet being worn down in general
6. Worn or scratched enamel on bathtubs
7. Loose grout on tile flooring
8. Cabinet doors sticking

Of course, your landlord should’ve told you examples of what they consider normal wear and tear. In my personal experience, if you’re ever unsure, just ask them, and they’ll tell you. This way, you’re both on the same page.

What to Do When Damages Are More Than Your Deposit?

If you unfortunately didn’t take care of your rental unit and damaged your unit, you could see that you need to pay your landlord more money on top of them keeping your security deposit. To avoid this problem, you can try two solutions:

1. Take care of your rental at all times so you don’t have to worry about any damage.
2. Have a walk out with your property owner so you know what damage they’ll say you’re responsible for paying and how much it’ll cost.

If the landlord needs more money from you, they’ll send a demand letter for the remaining amount owed. You shouldn’t ignore this letter because if you ignore it, they could consider the small claims court option.

What to Do When You Haven’t Received Your Security Deposit

Let’s say you’ve followed all the steps from the “6 Steps for a Tenant to Receive Their Security Deposit” section, and you’ve waited the appropriate amount of time for your state to receive your security deposit.

And yet, you still haven’t received it.

You have several options on how to get your deposit back. Each option has some pros and cons, and of course, it’ll depend on your relationship with your landlord.

If you have a great relationship with your landlord, you might want to try one of the first options. If you don’t have a great relationship with your landlord, you might want to skip ahead to the next section: “How to Send a Request for Return of Security Deposit Form.” Below are three steps to take when you haven’t received your security deposit:

1. Email them: If you don’t like talking on the phone or in person, and you’re not ready to go a more official route through the mail, you can email them. It’s possible they forgot, or you forgot to give a forwarding address.
2. Call them: For a quicker response compared to email but still not talking to someone face to face, a phone call will likely result in someone answering your call and giving you an update on the status of your security deposit.
3. Communicate in person: You can go to your old rental office and talk to some directly. This face-to-face contact will require an answer immediately.

Of course, no matter which option you choose, please remember to be polite, cordial, and kind to others. Even if you’re not in the wrong at all, you’ll be able to get more accomplished by being nice vs. being rude. Plus, the person you talk to might not even be responsible for you not receiving your deposit yet.

4 Steps on How to Send a Request for Return of Security Deposit Form

Let’s say you have a bad relationship with the property owner, or you want to skip the three options from above and send something more official right away. We’ll give you four steps on how to send a request for return of Security Deposit Form.

Step 1: Fill out the request for Return of Security Deposit Form and make sure two print out two copies. One copy for your landlord and one copy for your personal records. You also should keep a photocopy of the form for yourself.

Step 2: Use certified mail with return receipt requested to send the form to your former landlord. If you don’t know how to send Certified Mail, the employees at the U.S. Post Office can help you out.

Step 3: You need to keep the return receipt for your personal records for later.

Step 4: If they haven’t responded at all in the time frame sent in your letter, you could take them to a small claims court.

Note: If you decide to take your landlord to a small claims court, you’ll want to make sure you send them a letter first. This way, you have evidence showing proof that you sent them a letter requesting your deposit, confirmation of them receiving your letter, but still failed to give it to you.

What’s a Pet Deposit? How’s It Different from a Security Deposit?

A pet deposit works in the same way as a security deposit, but it’s used for pets. Pet deposits are intended only to repair damage caused by a pet. Like security deposits, the landlord must itemize and note the damage and the expense of repairing the damage as to why they’re keeping all or part of your pet deposit.

Some property owners might require a non-refundable pet fee BUT a refundable pet deposit. It can only be used for damage caused by a pet such as chewing a baseboard. They can’t use it for a window you broke.

They must return your deposit once your lease ends based on your state’s deadline.

“The Federal Fair Housing Act prohibits landlords discriminating based on disability,” according to servicedogcertifications.org. This means a property owner can’t charge someone a pet fee or deposit — even at a discounted price — for their service dog.

You’ll also get the pet fee and pet deposit waived when you also have an emotional support animal. Of course, you’ll most likely need to provide documentation for your service animal or emotional support animal.

Know What to Expect with Your Security Deposit

While you’re giving your security deposit to a landlord or property owner, it’s still your money. If you take care of your rental unit and don’t damage the property’s common areas, you should receive all or most of your deposit.

Now that you know the answer to: “What Is a Security Deposit?” you know what to expect before giving your deposit and when to expect it back and how it’s calculated.

If you work with your landlord and communicate effectively with them, you’ll less likely to have problems later down the road. At the same time, you should know and understand your rights as a tenant in your state.

Frequently Asked Questions

Q: What is the meaning of a security deposit?

A: A security deposit is a financial safeguard provided by a tenant to their landlord or property manager before moving into an apartment or house. This deposit serves a dual purpose: It protects the landlord against potential damage or unpaid rent during the tenant's lease agreement, while also offering assurance to the renter that their rental unit will be in good condition at the end of their lease.

Q: Do you get the security deposit back?

A: Yes, in most cases, tenants can expect to receive their security deposit back. However, the return of the security deposit depends on several factors, including the condition of the rental unit at the end of the lease and the tenant's adherence to their lease agreement.

To increase the likelihood of getting the security deposit back, tenants should take good care of the rental unit, ensure it's clean and free from significant damage, pay any outstanding bills, and follow the guidelines provided by their landlord or property manager.

Effective communication with the landlord and understanding tenant rights in their state also can contribute to a smoother return of the security deposit. Each state has specific deadlines for the return of the security deposit, which tenants should be aware of to ensure a timely refund.