Oregon Security Deposit Laws (2024): Returns & Deductions

Last Updated: December 12, 2024 by Roberto Valenzuela

Quick Facts	Answer
Acceptable Deductions	Unpaid rent, utilities, and late fees Costs of damage Damages due to breach of lease Carpet cleaning costs
Return Deadline	31 Days
Itemized Deductions	Required
Penalty for Late Return	2x Amount due + court costs + attorneys’ fees

For laws on security deposit collections and holdings in Oregon, click here.

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Some cities and counties may have regulations which are different from those presented here. Always check local laws.

Security Deposit Deductions in Oregon

Oregon allows these deductions from a security deposit:

Unpaid rent, utilities, and late fees
Costs of damage excluding normal wear and tear
Monetary damage as a result of a breach of the lease
Costs of carpet cleaning

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Landlords in Oregon can make deductions for damage whether or not they repair the damage.

Most states, including Oregon, do not have a legal limit on how much a landlord can charge for damages except that the charges must be reasonable and reflect actual landlord expenses.

If the cost of damage 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 Oregon?

“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 Oregon?

Landlords can charge for replacing the carpet if it is damaged beyond normal wear and tear.

example

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 Oregon?

Oregon 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 Oregon?

Landlords in Oregon can charge a cleaning fee if the tenant causes damage that requires cleaning (e.g. walls stained from smoke). Landlords can also charge for carpet cleaning requiring more than a common vacuum cleaner.

However, in order to recover costs for carpet cleaning, landlords must:

Use a machine specifically designed to clean carpets
Only charge a fee if the carpet was cleaned or replaced after the previous tenancy
Include the charge in the lease agreement as a condition regardless of whether or not the tenant cleans the carpet
Conduct the cleaning in a timely manner if it is done while the tenant occupies the rental unit

Can the Landlord Charge for Painting in Oregon?

Oregon 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 Oregon

Landlords must return a security deposit by first-class mail or hand-delivery to the tenant’s last known address no later than 31 days after the lease term ends and the tenant vacates the rental unit. If deductions are made, an itemized list of deductions must be included.

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Oregon does allow a landlord to deliver the security deposit and/or itemized list of deductions via email, but only if the landlord and tenant have previously made a special agreement to allow electronic notice.

When returning a security deposit in Portland, landlords must:

Provide a completed Rental History Form
Provide written notice of the tenant’s security deposit rights (or a printed copy of Portland City Code § 30.01.087 with contact information for the nearest Legal Aid Services of Oregon or the Oregon State Bar)
Conduct a final inspection
Create a final condition report detailing any damage beyond normal wear and tear with pictures

See Portland Landlord-Tenant Law for more information.

How Long Do Landlords Have To Return Security Deposits in Oregon?

Oregon landlords have 31 days after the lease term ends and the tenant vacates the rental unit to return any remaining portion of a security deposit.

However, the landlord must return the security deposit within 14 days after a notice of termination if a government agency deems the rental unit unsafe due to conditions that may affect the health or safety of the tenant. The tenant can choose the method of delivery. If they fail to do so, the landlord must return the deposit by first-class mail.

Do Landlords Owe Interest on Security Deposits in Oregon?

Oregon state law does not require landlords to provide interest on held security deposits.

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In Portland, if a security deposit is held in an interest-bearing account, it must be paid to the tenant unless it is applied toward damages. However, landlords can keep up to 5% of the interest for administrative expenses.

How Do Landlords Give Notice?

If deductions are to be made from the security deposit, an itemized statement of deductions must be sent by first-class mail or hand-delivery to the tenant’s last known address. The statement of deductions must provide separate accounting for the security deposit and prepaid rent (which can only be used for unpaid rent).

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Security deposits and written statements of deductions cannot be sent by certified or registered mail.

Can a Security Deposit Be Used for Last Month’s Rent in Oregon?

Oregon 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 Oregon

If landlords do not return the security deposit or provide a written statement of deductions, if any, within the required time period, tenants can file for damages in court up to twice the amount wrongfully withheld plus court costs and reasonable attorneys’ fees.

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In Portland, the maximum penalty is $250 per violation plus actual damages, court costs, and reasonable attorneys’ fees.

Tenants can also take legal action against a landlord for:

Failure to list the security deposit in the lease agreement
Unreasonable deductions

How Can Tenants File a Dispute for a Security Deposit in Oregon?

If a landlord fails to perform their obligations regarding a security deposit, the tenant can file a dispute in the small claims division of Circuit Court or Justice Court if the amount of damages is less than $10,000. If the amount is greater, the tenant must file a civil case in the Circuit or Justice Court.

A small claims case regarding the return of a security deposit must be filed within 1 year.

Cases are filed in the county where the rental property is located or where the defendant lives. Representation by an attorney is not permitted unless approved by the judge. Filing fees vary depending on the court.

Sources

1 ORS § 90.300(7): (a) The landlord may claim from the security deposit only the amount reasonably necessary:

(A) To remedy the tenant’s defaults in the performance of the rental agreement including, but not limited to, unpaid rent; and

(B) To repair damages to the premises caused by the tenant, not including ordinary wear and tear.

(b) A landlord is not required to repair damage caused by the tenant in order for the landlord to claim against the deposit for the cost to make the repair. Any labor costs the landlord assesses under this subsection for cleaning or repairs must be based on a reasonable hourly rate. The landlord may charge a reasonable hourly rate for the landlord’s own performance of cleaning or repair work.

(c) Defaults and damages for which a landlord may recover under this subsection include, but are not limited to:

(A) Carpet cleaning, other than the use of a common vacuum cleaner, if:

(i) The cleaning is performed by use of a machine specifically designed for cleaning or shampooing carpets;

(ii) The carpet was cleaned or replaced after the previous tenancy or the most recent significant use of the carpet and before the tenant took possession; and

(iii) The written rental agreement provides that the landlord may deduct the cost of carpet cleaning regardless of whether the tenant cleans the carpet before the tenant delivers possession as described in ORS 90.147.

(B) Loss of use of the dwelling unit during the performance of necessary cleaning or repairs for which the tenant is responsible under this subsection if the cleaning or repairs are performed in a timely manner.
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2 ORS § 90.300(18): This section does not preclude the landlord or tenant from recovering other damages under this chapter.

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3 ORS § 90.155(1)(d): Except as provided in subsection (5) of this section, electronic mail, for written notices to the landlord or the tenant, only if allowed under a written addendum to the rental agreement that:

(A) Specifies the electronic mail address from which the landlord agrees to send, and at which the landlord agrees to receive, electronic mail;

(B) Specifies the electronic mail address from which the tenant agrees to send, and at which the tenant agrees to receive, electronic mail;

(C) Is executed by both parties after the tenancy begins and the tenant has occupied the premises;

(D) Allows the landlord or tenant to terminate the service of written notice by electronic mail or to change their specified electronic mail address for receipt of written notice by giving no less than three days’ written notice; and

(E) Includes notice in substantially the following form:

______________________________________________________________________________

THIS IS AN IMPORTANT NOTICE ABOUT YOUR RIGHTS REGARDING RECEIPT OF WRITTEN NOTICES.

By signing this addendum, you agree to receive written notices from your landlord by e-mail. This may include important legal notices, including rent increase and tenancy termination notices. Failure to read or respond to a written notice could result in you losing your housing or being unaware of a change in rent. Signing this addendum is voluntary. Only agree to service of written notices electronically if you check your e-mail regularly.

______________________________________________________________________________
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4 ORS § 90.300(13) & (14): (13) The landlord shall return to the tenant the security deposit or prepaid rent or the portion of the security deposit or prepaid rent that the landlord does not claim in the manner provided by subsections (11) and (12) of this section not later than 31 days after the tenancy terminates and the tenant delivers possession to the landlord. If agreed to by both parties in an addendum executed after the tenancy begins and the tenant has occupied the premises, the landlord may return any amount due under this subsection electronically to a bank account or other financial institution designated by the tenant.

(14) The landlord shall give the written accounting required under subsection (12) of this section or shall return the security deposit or prepaid rent as required by subsection (13) of this section by personal delivery or by first class mail or, if allowed under ORS 90.155(1)(d), by electronic mail.
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5 Portland City Code § 30.01.087(B): 1. Within 2 weeks following receipt of a Tenant’s funds paid as a Security Deposit or for last-month’s Rent, a Landlord shall deposit all of such funds into a secure financial institution account segregated from the Landlord’s personal and business operating accounts. If the account is an interest-bearing account, all interest shall accrue proportionately to the benefit of the Tenant and shall be returned to the Tenant with the unused security deposit in accordance with Subsection B.2. below. If the account bears interest, the Landlord is required to pay such interest in full, minus an optional 5 percent deduction for administrative costs from such interest, to the Tenant unless it is used to cover any claims for damage. For interest bearing accounts, the Landlord must provide a receipt of the account and any interest earned at the Tenant’s request, no more than once per year. The Rental Agreement must reflect the name and address of the financial institution at which the Security Deposit is deposited and whether the Security Deposit is held in an interest-bearing account.

2. A Landlord shall provide a written accounting and refund in accordance with ORS 90.300.
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6 ORS § 90.300(12): In order to claim all or part of any prepaid rent or security deposit, within 31 days after the tenancy terminates and the tenant delivers possession the landlord shall give to the tenant a written accounting that states specifically the basis or bases of the claim. The landlord shall give a separate accounting for security deposits and for prepaid rent.

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7 ORS § 90.380(6): If the tenancy is terminated, as a result of conditions as described in subsections (2), (4) and (5) of this section, within 14 days of the notice of termination the landlord shall return to the applicant or tenant:

(a) All of the deposit to secure the execution of a rental agreement, security deposit or prepaid rent owed to the applicant under this section or to the tenant under ORS 90.300; and

(b) All rent prepaid for the month in which the termination occurs, prorated, if applicable, to the date of termination or the date the tenant vacates the premises, whichever is later.
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8 ORS § 90.100(18): “First class mail” does not include certified or registered mail, or any other form of mail that may delay or hinder actual delivery of mail to the recipient.

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9 ORS § 90.300(16): If the landlord fails to comply with subsection (13) of this section or if the landlord in bad faith fails to return all or any portion of any prepaid rent or security deposit due to the tenant under this chapter or the rental agreement, the tenant may recover the money due in an amount equal to twice the amount:

(a) Withheld without a written accounting under subsection (12) of this section; or

(b) Withheld in bad faith.

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10 ORS § 90.255: In any action on a rental agreement or arising under this chapter, reasonable attorney fees at trial and on appeal may be awarded to the prevailing party together with costs and necessary disbursements, notwithstanding any agreement to the contrary. As used in this section, “prevailing party” means the party in whose favor final judgment is rendered.

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11 Portland City Code § 30.01.087(G): A Landlord that fails to comply with any of the requirements set forth in this Section shall be liable to the Tenant for an amount up to $250 per violation plus actual damages, reasonable attorney fees and costs (collectively, “Damages”). Any Tenant aggrieved by a Landlord’s noncompliance with the foregoing has a cause of action in any court of competent jurisdiction for Damages and such other remedies as may be appropriate.
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12 ORS § 46.405(3): Except as provided in this section, an action for the recovery of money, damages, specific personal property, or any penalty or forfeiture may be commenced and prosecuted in the small claims department if the amount or value claimed in the action does not exceed $10,000.

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13 ORS § 12.125: An action arising under a rental agreement or ORS chapter 90 shall be commenced within one year.

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