Few tenants anxiously await the moment when they can pay that security deposit on a new dwelling unit. But almost all keep their eye on the calendar when it comes to getting it back when they move out. So, what are tenants' rights in California regarding security deposit returns? California law requires that landlords return security deposits – or explain why they aren't returning the funds – within 21 days from the day the tenants move out.
Are Tenants Protected by Security Deposit Caps?
A security deposit is a fact of life in California. Landlords want to get a deposit in place in case the tenant fails to pay rent or leaves the unit damaged or dirty. But there is often friction at the end of the tenancy as tenants demand a return of their deposit and landlords may have other ideas.
Security deposit laws in California give both landlords and tenants guidelines toward resolving security deposit issues, and courts will enforce those laws if necessary. California law caps the amount of security deposit a landlord can demand. The caps are based on multiples of a month's rent and are different for furnished and unfurnished units:
- Two times the rent = unfurnished unit security deposit.
- Three times the rent = furnished unit security deposit.
A landlord is not permitted to exceed this security deposit cap in any circumstances.
Other Types of Required Deposits
Are landlords able to collect other types of deposits? Like key deposits or last month's rent deposit, for example? Yes, they are. But all of these deposits taken together must not exceed the security deposit cap.
For example, imagine a $1,500-a-month furnished rental. The security deposit cap will be three times that amount, or $4,500. If the landlord seeks a last month's rent deposit of $1,500 and a cleaning deposit of $2,500, all is well. If he also asks for a pet deposit of $1,000, the amount now totals $5,000, which is above the allowable $4,500 cap.
Must Tenants Make Nonrefundable Deposits?
Regular security deposits are refundable. If the tenants pay the rent and leave the apartment clean and undamaged, the deposits are returned. But what if the landlord classifies some deposits as nonrefundable and includes this in the rental agreement?
Tenants in California are protected against nonrefundable deposits, which are essentially fees. All deposits tenants make to a landlord are refundable if they pay their rent and return the unit in appropriate condition. A landlord cannot change this basic legal right of the tenants by classifying a deposit as nonrefundable.
Can Landlords Deduct Unpaid Rent?
California's security deposit laws make it clear what amounts landlords can deduct from security deposits and what they can't. First, if the departing tenants have unpaid back rent due and owing, the landlord can take money from the security deposit to cover those rent payments.
Even if tenants have kept up with their rent payments, if they leave without giving the landlord the obligatory 30-day written notice, they will owe one more month's rent. In California, either party can end a month-to-month tenancy by giving the other party 30 days' notice. That means that if tenants wants to leave, they have to let the landlord know a month before they go. If they just wait until the end of a month and move out, they still owe the landlord for the 30 days they should have stayed if they had given the legal notice.
What Else Can a Landlord Deduct?
Landlords can also deduct the costs of repairing any damages the tenants did to the unit. For example, if the tenants cracked the mirror in the bathroom and removed and disposed of an overhead light, the landlord can replace the mirror and the light, and deduct the costs of the items plus the installation cost from the tenant's security deposit.
Similarly, if tenants leave the apartment dirty, the landlord can deduct cleaning costs. But in order to qualify for cleaning costs, the landlord must establish that the tenants left the unit dirtier and in worse condition than it was when they moved in. And the law specifies that ordinary wear and tear, the usage that is the normal result of living in the unit, doesn't count as damage or dirtiness.
What does ordinary wear and tear mean in practice? The tenants paid every month for the right to live in the unit. Living in the unit includes the right to walk up and down the carpeted halls and use the washer and dryer to clean their clothes.
The fact that the carpets are more worn than when the tenants moved in or the washing machine is not as new is not due to any fault of the tenants. A landlord cannot retain the deposit in order to replace the carpet or the washing machine simply because it is more worn than at the beginning of the tenancy.
What Is the California Security Deposit Return Deadline?
In California, a landlord has 21 days from the day the tenants depart to return the security deposit to the tenants or explain why he is not returning part or all of it. If the landlord intends to return the entire amount, he must hand it to the tenants or mail it to their new address within that deadline.
If the landlord is intending to keep part or all of the deposit, he must still mail any remaining amount back to the tenants within 21 days, and must also include in that envelope a written statement detailing the money he deducted from the security deposit and stating the reason for each deduction.
If the amount deducted is over $125, the landlord must also send copies of invoices and receipts showing how the money was spent. If the work hasn't been done yet, the landlord must give an estimate of the amount, then send invoices and receipts within two weeks of the time he gets them.
Can Tenants Prevent Deductions From the Deposit?
California law gives tenants the opportunity to increase their chances for getting the entire security deposit returned – the right to request a pre-move inspection. When giving their 30-day notice, tenants can demand that the landlord do an initial inspection 14 days before the move-out date. At that time, the landlord must provide the tenants with a written list of the deductions he proposes to take from the security deposit.
Tenants can use the remaining two weeks of their tenancy to clean, repair and otherwise take care of the items on the landlord's list. If tenants deny responsibility for the items on the list, they can take photos of the problem areas and gather evidence to show why it should not be their responsibility.
After the tenants move out, the landlord does his final inspection and determines what damage or dirty areas remain from his original list. He cannot add any new items to the list unless the problem was hidden during the preliminary inspection.
Do California Tenants Get Security Deposit Interest?
California state law does not give tenants the right to interest on their security deposits. However many cities have enacted rent control laws and some of these do grant tenants the right to interest. These include Los Angeles and Berkeley. Tenants vacating a dwelling in a rent controlled city should check with their local rent control board.
What if a Landlord Doesn't Return the Deposit in 21 days?
If a landlord doesn't return the deposit or otherwise communicate with the tenants within the time period set in the statute, the tenants' first step is to contact him. This is best done by letter or by email so that the tenant has a record of the communication. The tenants should point out the amount of the deposit and the date on which they vacated the premises. They should demand the deposit back immediately.
If tenants still don't hear from the landlord, or the landlord sends a letter saying he intends to keep the security deposit for repairs and damages that the tenants dispute, the tenants can file a case in small claims court if the total amount due is under $10,000, otherwise they can sue in superior court. Tenants can ask the court to order the landlord to return the security deposit and also ask for damages of twice the amount of the security deposit for the landlord's bad-faith refusal to return the deposit as required by law.