Tenants Say Security Deposit Increase is Illegal
by Janet Portman, Inman News
Q: Our one-year lease expired four months ago and we defaulted to a month-to-month tenancy. Our landlord recently gave us notice of a rent increase (11 percent more!) and a security deposit increase. I realize our landlord can increase the rent (with proper notice), but I question his ability to increase the security deposit, too.
I searched the rental laws on security deposits as well as the state’s Web site with information for renters, but found nothing about collecting additional security when the rent is increased. Is this legal? Should we ask the manager to prove why he needs the additional security? Since we didn’t sign a new lease, shouldn’t the original lease terms (including the amount of the original deposit) govern our month-to-month tenancy? –Stacy M.
A: Your landlord’s request for an additional security deposit, given the increased rent, is legal. You’re right that when a lease defaults to a monthly rental agreement, the terms of the lease apply. However, when the landlord increased the rent, he was putting you on notice that a new monthly rental agreement would begin, after the expiration of the notice period. If your state, like many, sets permissible maximum deposits as a multiple of the rent, then the maximum allowable deposit also went up, and your landlord was free to take advantage of the opportunity to increase the deposit. (If your state does not regulate deposits, your landlord may raise the deposit as high as he chooses, with proper notice.) The essential thing to understand is that with new rent came a new rental agreement, which gave the landlord the opportunity to change any term, including the amount of the deposit.
You could ask the landlord to prove his need for more security from you, but he’s under no obligation to answer — state laws don’t require landlords to justify an increase. But this doesn’t mean that you can’t attempt to reason with your landlord. Security deposits are just that — security in case the tenant fails to pay the rent or leaves the rental with damage beyond normal wear and tear. If you do neither, the entire sum comes back to you. During your tenancy, have you given the owner any reason to believe that he’ll need this money to cover unpaid rent or damage? If you’ve always paid rent on time, and keep a clean and damage-free house, the owner won’t need the money. If your state requires landlords to keep deposits in a separate bank account, theoretically the money isn’t even available for his use during your tenancy. Have a friendly conversation and see if the landlord won’t rethink, based on your record as a good tenant. Or, if the increase is hefty, ask the landlord if you can stretch out payments for a few months, rather than pay all at once.
Janet Portman is an attorney and managing editor at Nolo. She specializes in landlord/tenant law and is co-author of “Every Landlord’s Legal Guide” and “Every Tenant’s Legal Guide.” She can be reached at [email protected] .
What’s your opinion? Leave your comments below or send a letter to the editor. To contact the writer, click the byline at the top of the story. Copyright 2008 Janet Portman
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