| Quick Facts | Answer |
| Acceptable Deductions | Unpaid rent, late fees, utilities and bills
Costs of damage Damages due to early termination Costs of re-renting due to breach of lease Costs to remove or store tenant’s belongings Court costs |
| Return Deadline | 30 days |
| Itemized Deductions | Required |
| Penalty for Late Return | Amount due + attorneys’ fees |
For laws on security deposit collections and holdings in North Carolina, click here.
Some cities and counties may have regulations which are different from those presented here. Always check local laws.
Security Deposit Deductions in North Carolina
North Carolina allows these deductions from a security deposit:
- Unpaid rent, late fees, utilities, or bills
- Costs of damage excluding normal wear and tear
- Damages as a result of early termination of the lease
- Costs of re-renting the unit as a result of a breach of the lease
- Costs to remove or store tenant’s belongings
- Court costs
Most states, including North Carolina, do not have a legal limit on how much a landlord can charge for damages except that they must reflect the landlord’s actual expenses.
If the cost of the damages exceeds the amount of the security deposit, landlords are entitled to seek additional damages from the former tenant.
What Is Considered Normal Wear and Tear in North Carolina?
“Normal wear and tear” is damage and deterioration to a property that happens over time using an ordinary and reasonable level of care. Normal wear and tear includes things like:
- Gently worn carpets
- Lightly scratched glass
- Faded paint and flooring
- Lightly dirtied grout
- Loose door handles
- Stained bath fixtures
“Excessive damage” means any careless, reckless, or intentional damage that occurs because of someone on the property with the tenant’s permission. Examples include:
- Heavily stained, burned, or torn carpets
- Broken tiles or windows
- Holes in the wall
- Missing fixtures
Can the Landlord Charge for Replacing the Carpet in North Carolina?
Landlords can charge for replacing the carpet if it is damaged beyond normal wear and tear.
A carpet that is slightly discolored or gently worn will be considered normal wear and tear. A carpet with visible stains, major discoloration and rips will be considered excessively damaged.
Can the Landlord Charge for Nail Holes in North Carolina?
North Carolina landlords can charge a tenant for nail holes if they damage the walls in a way that doesn’t demonstrate an ordinary and reasonable level of care.
Tenants have the right to use the walls within their unit in a reasonable way. This includes inserting small nails or thumbtacks to hang posters or pictures.
However, large holes from drilling, multiple nail holes, large nail holes, and holes made for hanging heavier things may be considered damage, and thus chargeable to the tenant.
Can the Landlord Charge a Cleaning Fee in North Carolina?
Landlords in North Carolina can charge a cleaning fee if it is specifically stated in the lease agreement.
Landlords can also make deductions for cleaning from the security deposit if the tenant causes damage that requires the unit to be cleaned.
Can the Landlord Charge for Painting in North Carolina?
North Carolina landlords can charge for painting, except for normal wear and tear. For example, a landlord might be able to charge for:
- Damage to the paint beyond normal wear and tear
- Tenant repainting without the landlord’s consent
- Tenant repainting with consent, but not doing the work to a professional standard
Normal paint wear includes:
- Minor scrapes from daily use
- Fading due to sunlight
- Minor cracks in the original paint.
Landlords can charge for repainting if the damage is not the result of ordinary care. This includes stains, large or deep scratches, and water damage.
Security Deposit Returns in North Carolina
Landlords must return a security deposit with an itemized statement (if there are deductions) to the tenant’s last known address no later than 30 days after the lease ends and the tenant vacates the rental unit.
How Long Do Landlords Have to Return Security Deposits in North Carolina?
North Carolina landlords have 30 days after the lease ends and the tenant vacates the rental unit to return any unused portion of the security deposit.
Do Landlords Owe Interest on Security Deposits in North Carolina?
Unlike in some states, such as New Jersey, landlords in North Carolina do not owe interest on security deposits.
How Do Landlords Give Notice in North Carolina?
If deductions are to be made from the security deposit, an itemized statement of damages must be sent by mail or hand-delivery to the tenant’s last known address no later than 30 days after the lease ends and the tenant vacates the rental unit.
If the landlord cannot determine their damages within 30 days, they must provide the tenant with an estimate by 30 days and then a final accounting of damages within 60 days after the lease ends and the tenant vacates the rental unit.
If the landlord does not know the tenant’s address, they must hold the remaining portion of the security deposit for the tenant to claim for at least six months.
Can a Security Deposit Be Used for Last Month’s Rent in North Carolina?
North Carolina law does not forbid the security deposit from being used for any outstanding rent.
Landlords can include a provision in the lease agreement that the security deposit cannot be used for the last month’s rent until the tenant vacates the rental unit.
Security Deposit Disputes in North Carolina
If landlords do not return the security deposit within the required time period, tenants can file a claim in court for up to the amount of the deposit due to the tenant plus reasonable attorneys’ fees.
Tenants can also take legal action against a landlord for:
- Failure to provide an itemized statement that lists deductions if the security deposit is not returned in full
- Failure to hold the security deposit in an escrow account or post a bond
- Unreasonable deductions
If the court finds that the landlord intentionally failed to comply with the security deposit rules, the tenant may be awarded the full amount of the security deposit.
How Can Tenants File a Dispute for a Security Deposit in North Carolina?
If a landlord fails to perform their obligations regarding a security deposit, the tenant can file a dispute in the small claims division of District Court if the amount of damages is less than $10,000, although the maximum claim amount in some counties is $5,000. If the amount is greater, the tenant must file a civil case in District Court.
A small claims case regarding the return of a security deposit must be filed within 3 years. Cases are filed in the District Court where the defendant lives. An attorney is not required but permitted.Filing fees are $96.
Sources
- 1 N.C. Gen. Stat. § 42-51
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Security deposits for residential dwelling units shall be permitted only for the following:
(1) The tenant’s possible nonpayment of rent and costs for water or sewer services provided pursuant to G.S. 62-110(g) and electric service pursuant to G.S. 62-110(h).
(2) Damage to the premises, including damage to or destruction of smoke alarms or carbon monoxide alarms.
(3) Damages as the result of the nonfulfillment of the rental period, except where the tenant terminated the rental agreement under G.S. 42-45, G.S. 42-45.1, or because the tenant was forced to leave the property because of the landlord’s violation of Article 2A of Chapter 42 of the General Statutes or was constructively evicted by the landlord’s violation of G.S. 42-42(a).
(4) Any unpaid bills that become a lien against the demised property due to the tenant’s occupancy.
(5) The costs of re-renting the premises after breach by the tenant, including any reasonable fees or commissions paid by the landlord to a licensed real estate broker to re-rent the premises.
(6) The costs of removal and storage of the tenant’s property after a summary ejectment proceeding.
(7) Court costs.
(8) Any fee permitted by G.S. 42-46.
Source Link - 2 N.C. Gen. Stat. § 42-52
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Upon termination of the tenancy, money held by the landlord as security may be applied as permitted in G.S. 42-51 or, if not so applied, shall be refunded to the tenant. In either case the landlord in writing shall itemize any damage and mail or deliver same to the tenant, together with the balance of the security deposit, no later than 30 days after termination of the tenancy and delivery of possession of the premises to the landlord. If the extent of the landlord’s claim against the security deposit cannot be determined within 30 days, the landlord shall provide the tenant with an interim accounting no later than 30 days after termination of the tenancy and delivery of possession of the premises to the landlord and shall provide a final accounting within 60 days after termination of the tenancy and delivery of possession of the premises to the landlord. If the tenant’s address is unknown the landlord shall apply the deposit as permitted in G.S. 42-51 after a period of 30 days and the landlord shall hold the balance of the deposit for collection by the tenant for at least six months. The landlord may not withhold as damages part of the security deposit for conditions that are due to normal wear and tear nor may the landlord retain an amount from the security deposit which exceeds his actual damages.
Source Link - 3 N.C. Gen. Stat. § 42-55
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If the landlord or the landlord’s successor in interest fails to account for and refund the balance of the tenant’s security deposit as required by this Article, the tenant may institute a civil action to require the accounting of and the recovery of the balance of the deposit. The willful failure of a landlord to comply with the deposit, bond, or notice requirements of this Article shall void the landlord’s right to retain any portion of the tenant’s security deposit as otherwise permitted under G.S. 42-51. In addition to other remedies at law and equity, the tenant may recover damages resulting from noncompliance by the landlord; and upon a finding by the court that the party against whom judgment is rendered was in willful noncompliance with this Article, such willful noncompliance is against the public policy of this State and the court may award attorney’s fees to be taxed as part of the costs of court.
Source Link - 4 N.C. Gen. Stat. § 7A-210
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For purposes of this Article a small claim action is a civil action wherein:
(1) The amount in controversy, computed in accordance with G.S. 7A-243, does not exceed ten thousand dollars ($10,000); and
(2) The only principal relief prayed is monetary, or the recovery of specific personal property, or summary ejectment, or any combination of the foregoing in properly joined claims; and
(3) The plaintiff has requested assignment to a magistrate in the manner provided in this Article.The seeking of the ancillary remedy of claim and delivery or an order from the clerk of superior court for the relinquishment of property subject to a lien pursuant to G.S 44A-4(a) does not prevent an action otherwise qualifying as a small claim under this Article from so qualifying.
Source Link - 5 N.C. Gen. Stat. § 1-52(1) & (2)
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Within three years an action –
(1) Upon a contract, obligation or liability arising out of a contract, express or implied, except those mentioned in the preceding sections or in G.S. 1-53(1).
…
(2) Upon a liability created by statute, either state or federal, unless some other time is mentioned in the statute creating it.
Source Link
