As a landlord in California, it’s imperative to have a good understanding of the laws regarding security deposits. While they are not required, most landlords choose to hold a deposit in case there are physical or monetary damages that need to be remedied once a tenant vacates. The key is to know how much you can collect, what it can be used for, and when you are required to give any unused funds back.
Below are some of the most common questions (and answers) regarding security deposits in California.
1. Is there a limit to the amount a landlord can collect for a security deposit?
Yes! The maximum security deposit that can be collected for an unfurnished unit is 2x the rent. For a furnished unit, the maximum amount is up to 3x the rent.
However, there is an exception to that law for active service members which would require the landlord to reduce the deposit to a maximum of 1x the rent for an unfurnished property, and a limit of 2x the rent for a furnished property.
2. Can part of the security deposit be non-refundable?
In California, the law states that no portion of the security deposit can be held as non-refundable. That includes pet fees, cleaning fees, etc. At the end of the lease term, a landlord is expected to return the full deposit to the tenant, minus any allowable deductions.
3. Can a security deposit be used as last month’s rent?
If your lease agreement states that a portion of the deposit paid was designated as “last month’s rent,” that amount may be used for your last month’s rent. However, if your lease does not specifically state this, or if it states that it cannot be used as last month’s rent, then the landlord is not obligated to allow the deposit to be used to pay the last month’s rent.
4. Can tenants request a pre-move out inspection?
Yes! California tenants have the right to request a pre-move out inspection prior to vacating the property. The inspection gives them an opportunity to identify and fix any damage beyond normal wear and tear in the unit to minimize or avoid deductions to their deposit.
Tenants are not required to be present during a pre-move out inspection, but it is an option if the landlord and tenant can agree to a date and time. The inspection cannot be done any earlier than 2 weeks prior to the lease expiration date. A landlord is then required to provide an itemized list of deductions once the inspection is complete. The tenant may choose to either remedy the issues that were identified prior to the end of the lease, or allow the landlord to deduct them from the deposit.
5. What can be deducted from a tenant’s security deposit?
Security deposit handling can often be a source of conflict between landlords and tenants. It’s always best to be transparent and follow the law for any deductions that will be made to make sure both parties are satisfied with the outcome.
A California landlord can deduct the following from a tenant’s security deposit:
- The compensation of a landlord for a tenant’s default in the payment of rent. This includes breaking a lease early or abandoning the property.
- The repair of damages to the premises, exclusive of ordinary wear and tear, caused by the tenant or by a guest of the tenant. This would also include any damage done to the property by pets, whether they were approved to be in the home or not.
- The cleaning of the premises upon termination of the tenancy necessary to return the unit to the same level of cleanliness it was in at the inception of the tenancy.
6. How quickly does the tenant’s security deposit have to be returned?
Once the tenant vacates the property, the landlord has 21 days to return any unused portion of the security deposit along with an itemized statement of deductions.
7. What happens if there is a change in ownership?
If the rental property is sold, the current landlord has two options. The security deposit can be transferred to the new owner, or it can be transferred to the tenant (minus any allowable deductions). Either way, the landlord will need to notify the tenant of how it’s being handled and provide them with the new owner’s name, address and phone number as they will become the new landlord.
