The Landlord’s Guide To Security Deposits In Maryland
It is easy to find advice online for tenants about how to spot a landlord who is likely to rip you off or fail to make necessary repairs during your tenancy. It is also easy to find advice for landlords dealing with the difficult situation of dealing with tenants who are unable to pay but who enjoy legal protections from being evicted. What is less easy to figure out is how landlords can protect their interests while making their properties available to tenants who do not have a lengthy credit history or who have suffered financial hardships in the past that continue to affect the prospective tenant’s credit score, even though he or she has stayed at the same job for a year or more. Security deposits enable landlords to protect themselves from some of the risk associated with leasing an apartment to a new tenant. For help setting fair, conflict-proof policies in your lease agreements, including but not limited to security deposit policies, contact a Washington DC real estate lawyer.
Security Deposit Dos and Don’ts
A security deposit is an amount of money that a tenant pays to a landlord before moving into the rental unit. Most of the time, the security deposit is equal to one month’s rent, but Maryland law allows landlords to require security deposits in amounts as much as the equivalent of two months’ rent. If all goes well, and the tenant leaves on good terms at the end of the lease, the landlord refunds the deposit shortly after the tenant moves out. The landlord must refund the deposit to the tenant, plus 1.5 percent simple interest, no more than 45 days after the move out date, unless the landlord is entitled to keep part or all of the deposit amount.
When a tenant pays a security deposit, the landlord must provide a written receipt that acknowledges how much the tenant paid and the date when they paid it and lists the rights and obligations of the landlord and the tenant. These terms may also be present in the lease agreement. Landlords must deposit security deposits in a Maryland bank account that is exclusively for security deposits. The account must bear interest; in other words, it must be a savings account instead of a checking account.
The landlord may keep a portion of the deposit amount, or even the entire amount, if the tenant has caused damage to the rental unit beyond the usual wear and tear that one would expect based on the amount of time that the tenant lived there. If the landlord plans to keep the deposit, the landlord must notify the tenant of this. The tenant has the right to be present at the inspections of the unit that take place before move in and after move out.
Contact Us About Preventing Disputes With Tenants
A small business lawyer can help you run your residential real estate business with the kind of organization and transparency that will prevent disputes with tenants. Contact Tobin O’Connor Concino P.C. for help.