Security Deposit


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Security Deposit

Money aside from the payment of rent that a landlord requires a tenant to pay to be kept separately in a fund for use should the tenant cause damage to the premises or otherwise violate terms of the lease.

A security deposit is usually in the amount of one or two months' rent. It usually must be paid at the time that the Landlord and Tenant sign the lease. The landlord must place the funds in an escrow account and give the tenant any interest generated by such funds. Upon the termination of the lease, the landlord must return the security deposit to the tenant if no violations of the lease occurred. He or she may keep the security deposit or portion thereof for the amount of any damages, which can be proven, pursuant to the terms of the lease.

Cross-references

Landlord and Tenant.

security deposit

n. a payment required by a landlord from a tenant to cover the expenses of any repairs of damages to the premises greater than normal "wear and tear." The security deposit must be returned within a short time (varying by states) after the tenant vacates, less the cost of repairing any unusual damage. Unfortunately for tenants these damages are usually subject to the judgment of the landlord, who may desire to paint and refinish on the tenant's money, and is thus, resulting in many small claims suits. In a few states the security deposit must be kept in a separate bank account, and some states require payment of interest on the amount held as a deposit. A security deposit is sometimes confused with a deposit of the "last month's rent," which may be credited to the tenant for the final month's rent. A security deposit cannot be used legally as a rent credit. (See: landlord and tenant, rent, lease)

References in periodicals archive ?
Services can also be expected to be activated after 24 hours of paying the security deposit online.
But Edson calls the demand for a second security deposit "extortion," pure and simple.
It added: "Dewa would like to emphasise that all security deposits are fully refundable on settling the final bill, so that residents will continue to receive world-class electricity and water services.
Though the security deposit is fully refundable for the new tenants when they move out in future, it is not clear how the existing tenants can proceed vacating the premises without disconnecting the services and leaving an outstanding Dewa bill behind.
The Zero Security Deposit option is available only to successful, up-and-running SMEs that can demonstrate their good legal standing, a statement said.
The membership costs less than a traditional security deposit and apartment communities agree that members will have all or a portion of the security deposit waived for the life of their residency.
I am writing in regards to the security deposit that I paid under the lease of #11, 345 Renter Road.
What if a property owner were to instruct you to commingle the security deposit with the general operating account because the property has cash flow problems?
Jreij signed a 60-day lease, but didn't have the $25,000 security deposit for the gas.
The problem is that while minimum security deposits can work when viewed through the filter of a marketing strategy by lowering move-in costs, they don't address the original purpose of a security deposit--to effectively underwrite renter performance risk.
Unfortunately, you must look to your former landlord for the return of your security deposit.
Thus, the cash-advance discounts were like a loan or a security deposit, and were a liability rather than income when received.

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