The Four Conditions That Clearly Allow A Landlord To Legally Withhold A Security Deposit

Posted on: 8 January 2016

When a tenant gives a landlord a security deposit to rent an apartment or home, he or she does so trusting that the money will be returned upon moving out. However, a landlord can withhold security deposit funds if the tenant fails to meet his or her end of the rental agreement. 

The law is very specific in regards to when it's clearly legal for a landlord to refuse to return the security deposit at the time that a tenant moves out. A commercial real estate lawyer can easily defend a landlord who withholds funds for any of these reasons specified by law. 

The following are the four situations that without question legally permit the landlord to withhold this money:

Property damage that goes beyond what is considered normal "wear and tear" on the facilities

One of the primary reasons a landlord is supplied with a security deposit is to pay for any damage to the apartment or home that occurs while the tenant is a resident.

Of course, it can be difficult to legally define what "normal" wear and tear entails. This is a sticky issue in real estate law and will sometimes require the opinion of a court ruling to determine. 

A failure to pay rent

A landlord has a clear right to any security deposit funds if there is outstanding rent that the tenant has not paid. Of course, the landlord cannot withhold more of the security deposit than the tenant owes in rent. 

A failure to pay utility and/or cleaning bills

If there are outstanding utility bills or cleaning bills on the property, the landlord may be able to withhold the deposit.

However, this is only the case if the original rental agreement specified that the tenant would be responsible for the utility/cleaning bills in question. 

Abandonment of the rented piece of real estate without giving the landlord the opportunity to return the security deposit

The landlord is responsible for returning security deposit funds if none of the above-mentioned conditions exempts him or her from doing so. However, it is the tenant's responsibility to request the deposit from the landlord and make himself or herself available to receive it.

A landlord may be able to withhold the deposit if the tenant abandons the property and never returns seeking the deposit.

Additional reasons for withholding a security deposit

Landlords who feel it is their right to withhold a security deposit for any other reason should consult with a commercial real estate attorney. Some special circumstances that are not described above may also allow a landlord to withhold security deposit funds.

For instance, the landlord may be able to withhold security deposit funds if the tenant's actions can be proven to have left the landlord legally or financially liable for physical injury suffered by another party on the property. 

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