Find out how much a landlord can ask for a security deposit, what documentation they are (or aren’t) required to provide when collecting one, and other rules about the security deposit collection process.
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Maximum Security Deposit by State
Some states limit the maximum security deposit, like in Michigan, where the security deposit cannot be more than 1½ months’ rent. However, many states have no limit to the maximum security deposit, so landlords can collect as much as they choose—although it must still be a “reasonable” amount.
Most states with limits calculate their maximum as a multiplier of the monthly rent (such as 1x or 2x the monthly rent amount).
| State | Maximum Security Deposit |
|---|---|
| Alabama |
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| Alaska |
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| Arizona |
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| Arkansas |
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| California |
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| Colorado |
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| Connecticut |
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| Delaware |
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| Florida |
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| Georgia |
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| Hawaii |
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| Idaho |
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| Illinois |
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| Indiana |
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| Iowa |
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| Kansas |
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| Kentucky |
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| Louisiana |
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| Maine |
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| Maryland |
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| Massachusetts |
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| Michigan |
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| Minnesota |
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| Mississippi |
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| Missouri |
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| Montana |
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| Nebraska |
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| Nevada |
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| New Hampshire |
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| New Jersey |
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| New Mexico |
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| New York |
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| North Carolina |
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| North Dakota |
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| Ohio |
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| Oklahoma |
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| Oregon |
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| Pennsylvania |
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| Rhode Island |
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| South Carolina |
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| South Dakota |
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| Tennessee |
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| Texas |
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| Utah |
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| Vermont |
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| Virginia |
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| Washington |
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| Washington D.C. |
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| West Virginia |
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| Wisconsin |
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| Wyoming |
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Maximum Pet Deposit by State
All states allow landlords to collect pet deposits. In many states, there is no limit to the pet deposit. However, in some states, the total security deposit including the pet deposit cannot exceed that state’s security deposit limit.
For example, in New York, the maximum security deposit is one month’s rent, which must include the pet deposit. Landlords cannot collect one month’s rent as a “security deposit” and a second month’s rent as a “pet deposit.”
| State | Maximum Pet Deposit |
|---|---|
| Alabama |
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| Alaska |
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| Arizona | Total of all deposits cannot exceed:
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| Arkansas | Total of all deposits cannot exceed:
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| California | Total of all deposits cannot exceed:
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| Colorado | Total of all deposits cannot exceed:
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| Connecticut | Total of all deposits cannot exceed:
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| Delaware |
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| Florida |
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| Georgia |
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| Hawaii |
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| Idaho |
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| Illinois |
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| Indiana |
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| Iowa | Total of all deposits cannot exceed:
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| Kansas |
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| Kentucky |
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| Louisiana |
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| Maine | Total of all deposits cannot exceed:
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| Maryland | Total of all deposits cannot exceed:
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| Massachusetts | Total of all deposits cannot exceed:
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| Michigan | Total of all deposits cannot exceed:
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| Minnesota |
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| Mississippi |
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| Missouri |
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| Montana |
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| Nebraska |
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| Nevada | Total of all deposits cannot exceed:
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| New Hampshire | Total of all deposits cannot exceed:
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| New Jersey | Total of all deposits cannot exceed:
|
| New Mexico | Total of all deposits cannot exceed:
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| New York | Total of all deposits cannot exceed:
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| North Carolina | Total of all deposits cannot exceed:
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| North Dakota |
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| Ohio |
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| Oklahoma |
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| Oregon |
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| Pennsylvania | Total of all deposits cannot exceed:
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| Rhode Island | Total of all deposits cannot exceed:
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| South Carolina |
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| South Dakota |
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| Tennessee |
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| Texas |
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| Utah |
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| Vermont |
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| Virginia | Total of all deposits cannot exceed:
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| Washington |
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| Washington D.C. | Total of all deposits cannot exceed:
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| West Virginia |
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| Wisconsin |
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| Wyoming |
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Do Landlords Have to Provide a Receipt for a Security Deposit?
Many states require that landlords provide documentation when collecting a security deposit, like a receipt. Some state laws require landlords to provide specific information on the receipt in addition to the amount of the deposit, like the name and address of the bank where the security deposit is held.
The following states require that landlords provide a receipt or some form of written disclosure regarding the security deposit:
- Colorado
- Connecticut
- Delaware
- Florida
- Georgia
- Kentucky
- Maine
- Maryland
- Massachusetts
- Michigan
- Minnesota
- Nevada
- New Hampshire
- New Jersey
- New York
- North Carolina
- Oregon
- Pennsylvania
- Tennessee
- Washington
- Washington D.C.
- Wisconsin
Do Landlords Have to Use Escrow for Security Deposits?
The following states require that landlords hold security deposits in escrow, sometimes separate from their own funds, to guarantee that the funds will not be spent before the lease term ends.
- Alaska
- Colorado
- Connecticut
- Delaware
- Florida
- Georgia
- Idaho
- Iowa
- Kansas
- Kentucky
- Maine
- Maryland
- Massachusetts
- Michigan
- Missouri
- New Hampshire
- New Jersey
- New York
- North Carolina
- North Dakota
- Oklahoma
- Pennsylvania
- Tennessee
- Washington
- Washington D.C.
Landlords should be familiar with the holding requirements for security deposits to avoid potential penalties.
Do Landlords Owe Interest on Security Deposits?
In some states, landlords are required to provide interest on security deposits. The specific interest rate may be established by law, for example, 1% interest is required in Missouri. Some states change the rate of interest every year or base the rate on typical interest rates in certain types of accounts.
The following states require that landlords provide interest on security deposits in some or all situations.
- Arizona
- Connecticut
- Florida
- Illinois
- Iowa
- Maine
- Maryland
- Massachusetts
- Minnesota
- New Hampshire
- New Jersey
- New Mexico
- New York
- North Dakota
- Ohio
- Pennsylvania
- Washington D.C.
However, even though state law does not require landlords to provide interest on security deposits, cities and towns can require it. For example, California state law does not require landlords to provide interest on security deposits, but the laws of some cities like Los Angeles and San Francisco do.
What Happens to a Security Deposit When the Property is Sold?
When a rental property is sold, the security deposit still belongs to the tenant. In most states, landlords are required to transfer all security deposits to the new owner.
However, in some states, landlords can choose instead to return the security deposits to the tenants. In some cases, landlords or buyers must notify the tenants in writing of the sale and transfer.
Sources
- 1 Md. Code, Real. Prop. § 8-203
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(1) Except as provided in paragraph (2) of this subsection, a landlord may not impose a security deposit in excess of the equivalent of 1 month’s rent per dwelling unit, regardless of the number of tenants.
(2) A landlord may impose a security deposit in an amount equivalent to up to 2 months’ rent if:
(i) The tenant is eligible and has qualified for utility assistance through the Department of Human Services;
(ii) The lease agreement requires that the tenant make payments for utility services directly to the landlord; and
(iii) The tenant and landlord agree in writing to the amount of the security deposit.
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