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What Can You Do If Your Landlord Won’t Return Your Security Deposit?

by Louis DeNicola on
1/16/2021
in Housing and Homeownership
young woman moving out of an apartment

The following is presented for informational purposes only and is not legal advice.

You’re counting on getting your entire security deposit back when you move out of a rental. After all, you cleaned the place thoroughly and were a responsible tenant. However, your landlord may see things differently and want to keep some, or all, of the money.

Perhaps there was damage you didn’t notice, or you didn’t clean as thoroughly as you thought, or you didn’t fully pay the last month’s bills. Fair enough, the security deposit is there to help offset these costs.

But what if you did everything right and the landlord still won’t return your money? That’s when issues can arise. Here’s what you need to do.

Know your rights as a tenant

Rental laws can vary depending on your city, county, and state. You should check your local laws to find out what rights you have as a tenant.

The U.S. Department of Housing and Urban Development has a directory with links to tenant rights websites for each state and some cities. Your local city government may also have a housing department with additional resources, and there could be nonprofit tenants unions or housing advocacy groups in your area that can help explain relevant rental laws.

Depending on the applicable laws, your landlord may have several weeks to inspect the property and return your security deposit. Landlords that don’t return a full deposit may have to give you an itemized list of how they’re using the money (e.g., to pay for a cleaning service, repair damages, etc.) or forfeit their right to the security deposit.

Generally, you won’t be responsible for normal wear and tear on the property or the appliances. However, if you caused damage to the property, left it less clean than when you moved in, took keys or appliances, or moved out without proper notice, the landlord may be able to keep money to offset the associated costs for repairs, cleaning, replacements, and lost rental income. Also, be sure to give your landlord a forward address where the security deposit can be sent.

Options for dealing with a reluctant landlord

If your landlord is refusing to repay part or all of your security deposit and you think you’re in the right, you may want to start by contacting your landlord. A friendly discussion might help clarify why the landlord felt justified keeping the money, why you think that shouldn’t be the case, and lead to a mutually agreeable conclusion. If it doesn’t, here are a few other actions you could take:

Write a demand letter

The letter should give a clear overview of the situation, why you believe you deserve more money back, what you want the landlord to do, the specific amount you want to be repaid, and whether you’re considering taking legal action. Include references to relevant laws and any applicable documents or evidence, and then make a copy for your records before sending.

Hopefully, a strongly worded (but polite) letter will be enough.

File a claim in small claims court

You don’t need to hire an attorney to represent you in small claims court. However, you may need to send a demand letter before you can sue and there could be a small filing fee.

Bring all your evidence and records for the judge to review, including the lease, demand letters, correspondence, photos, and even a witness who can testify about the condition of the home when you moved in and out. Hopefully, the judge will rule in your favor and order the repayment of your security deposit. In some areas, a judge may even be able to award you more than the initial security deposit amount.

Hire an attorney

If you don’t feel comfortable representing your case in small claims court or feel that the specifics of a case may require an expert understanding of the law, you could hire an attorney who is familiar with your local rental laws. You may be able to find pro bono (i.e., free) legal aid. Or, you might be able to hire an attorney on contingency, and the attorney will only get paid if you win your case. Depending on the case, the opposing side may have to pay your attorney fees.

Having to deal with demand letters and the courts could resolve your issue, but it isn’t an ideal situation. You may be able to prepare ahead and avoid having to deal with the legal system.

Four steps to avoid a confrontation later

As is often the case, preventative care can be easier than fixing an emergency later. Here are a few steps you can take when you move into a new place could help you avoid security deposit issues.

Read more: What to Look for When Renting an Apartment

Do a walkthrough with your landlord before moving in

Ask the landlord to review the home with you and make a note of any damages and its current state of cleanliness. Take pictures of anything you find, or even take a video as you walk through the home. You could add notes to the lease about specific damages and ask the landlord to agree with your assessment before signing the lease. Or, you may want to print a separate checklist for you and the landlord to sign.

Review your lease terms

The lease should clearly outline how much the security deposit will be and when it will be returned.

Clean the home and repair any damages

If you leave the home a complete mess with holes in the walls, grime-covered floors, or abandoned belongings, the landlord is in the right to keep at least part of the security deposit to restore the home to its former condition. Clean and repair any mess or damage you cause, or hire someone to do the work for you before moving out.

Do another walkthrough when you move out

Just as you did before moving in, ask the landlord to do a final inspection with you. Take pictures or a video showing the condition of the home and ask the landlord to sign a move-out checklist. You could try to schedule the walkthrough for a day or two before your official move-out date, giving you time to do last-minute repairs and cleaning.

Whether you’re moving out of your first apartment or just bought a home and are going from renter to owner, getting your security deposit back can make the transition much easier.

There are a few preventative measures you can take to help ensure you’ll receive the correct amount back. If you think you’ve been wronged and aren’t receiving as much money back as you should, you can start with a friendly discussion with the landlord. When that doesn’t work, there are legal steps you can take that could help force the repayment of the security deposit.

And if there's a shortfall in your budget where the security deposit was supposed to go, there may be deeper issues at play. Take time to connect with a budget counselor to discuss your spending, saving, and debt repayment options. Counseling is free and available 24/7.

Tagged in Renting, Laws and legal questions

A corporate headshot of Louis DeNicola.

Louis DeNicola is a personal finance writer with a passion for sharing advice on credit and how to save money. In addition to being a contributing writer at MMI, you can find his work on Credit Karma, MSN Money, Cheapism, Business Insider, and Daily Finance.

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