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WHAT ARE THE RULES FOR RETURNING SECURITYDEPOSITS?

A security deposit is the money amounting to one or two months’ rent paid by the tenant to the landlord at the time they sign the lease contract and placed in an escrow account for use in case the tenant causes damage to the premises or fails to pay rent.

The landlord must return the money to the tenant if no violations of the lease occurred,or he/she may keep a portion of it for any damages to the property.

The money must be deposited in a bank or trust company account specifically for security deposits and separate from the landlord’s own money. The landlord must notify the tenant of the name and address of the bank or trust company along with the amount of the deposit. When the building is sold the owner must turn over security deposits to the new owner within five days.

The security of tenants in buildings with six or more dwelling units must be deposited in an interest-bearing account with the interest being either reinvested in the tenant's account or paid over to the tenant on a yearly basis.

In buildings with fewer than six dwelling units, it is up to the landlord whether or not to put the money in an interest bearing account. If the landlord does put a security deposit into such an account the interest must be paid over to the tenant or credited to the tenant annually. Landlords are entitled to be paid an annual administration fee (1% of the security deposit) for keeping track of a tenant's security deposit.

New Jersey and Connecticutboth have strict rules regarding the return of security deposits. The New Jersey law governing security deposits applies to all residential tenants except those in owner-occupied buildings with less than three rental units.

If the landlord fails to return a deposit or explain why it is being retained, he/shecan be liable to pay for double damages-- twice the amount of the security deposit plus the tenant's attorney fees.In New York, failure to return the deposit without just cause could subject the landlord to a civil action by the tenant.New Jersey law also requires landlords to place security deposits in interest-bearing accounts and to notify the tenant of the whereabouts of the deposit within 30 days of receiving it.

If the landlord doesn’t advise the tenant about where the security has been deposited, the tenant can demand that the security be applied to the next month’s rent and the landlord cannot require the tenant to provide a new security deposit.

In Connecticut, if a tenant provides the landlord with a forwarding address in time for the landlord to provide the necessary notice, and the landlord does not provide the notice or return the deposit, the tenant is automatically entitled to double the security deposit.

All residential tenants are covered by the state's security-deposit law which requires the depositing of such funds in interest-bearing bank accounts and makes no provision for the payment of administration fees to landlords.Landlords in Connecticut can demand up to two months' security from tenants who are younger than 62 and one month from tenants 62 and older.

Landlords may make reasonable deductions from a tenant's security deposit. Many states require landlords to provide a written itemized accounting of deductions for unpaid rent and for repairs for damages and necessary cleaning that exceed normal wear and tear, together with payment for any deposit balance.

The deadlines vary from state to state, but landlords usually have a set amount of time in which to return deposits, usually 14 to 30 days after the tenant moves out -- either voluntarily or by eviction.