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is the law governing security deposits for all units in California whether or not they are covered by rent control. Section 1950.5 does not address payment of interest on deposits, does. Note that the security deposit law was changed recently.

states that a security deposit is limited to one month鈥檚 rent, regardless of whether the unit is furnished or unfurnished. The exception is if the landlord is a human being who owns no more than two residential property that have fewer than four units for rent, or a limited liability corporation in which all members are human beings, they can charge up to two months rent.聽

There is no such thing as a non-refundable security deposit. No matter what it鈥檚 called鈥搆ey deposit, last month鈥檚 rent, pet deposits, etc.鈥揳ll the money you pay above your first month鈥檚 rent is refundable. A provision in a rental lease that represents a deposit as non-refundable is not enforceable. If you give your landlord money to 鈥渉old鈥 an apartment you are interested in renting, and then change your mind, it may be possible for the landlord to keep part or all of this deposit. Check with the Housing Rights Committee or a legal clinic.

INTEREST ON SECURITY DEPOSITS

The following are interest rates since the law first passed:

From September 1, 1983 to August 4, 2002, landlords had to pay 5% interest on money held over a year.
From Aug. 4, 2002 to Feb. 28, 2003: 3.4%
From March 1, 2003 to Feb. 28, 2004: 1.2%
From March 1, 2004 to Feb. 28, 2005: 1.2%
From March 1, 2005 to Feb. 28, 2006: 1.7%
From March 1, 2006 to Feb. 28, 2007: 3.7%
From March 1, 2007 to Feb. 28, 2008: 5.2%
From March 1, 2008 to Feb. 28, 2009: 5.2%
From March 1, 2009 to Feb. 28, 2010: 3.1%
From March 1, 2010 to Feb. 28, 2011: 0 .9%
From March 1, 2011 to Feb. 28, 2012: 0 .4%
From March 1, 2012 to Feb. 28, 2013: 0.4%
From March 1, 2013 to Feb. 28, 2014: 0.4%
From March 1, 2014 to Feb. 28, 2015: 0.3%
From March 1, 2015 to Feb. 28, 2016: 0.1%
From March 1, 2016 to Feb. 28, 2017: 0.2%
From March 1, 2017 to Feb. 28, 2018: 0.6%
From March 1, 2018 to Feb. 28, 2019: 1.2%
From March 1, 2019 to Feb. 28, 2020: 2.2%
From March 1, 2020 to Feb. 28, 2021: 2.2%

From March 1, 2021 to Feb. 28, 2022: 0.6%

From March 1, 2022 to Feb. 28, 2023: 0.1%

From March 1, 2023 to Feb. 28, 2024: 2.3%

From March 1, 2024 to Feb. 28, 2025: 5.2%

RETURNING DEPOSITS

Landlords have 21 days to return security deposits after you turn in your keys (on the final day of your 30-day notice). If all or part of your deposit is being withheld, your landlord must send you a written, itemized statement, within 21 days, listing the reasons why the amount is being withheld from your deposit and showing what they spent it on. A landlord can deduct for damages, but not for normal wear and tear. Click description of the difference between damage and normal wear and tear. One example we always use to distinguish is: The drapes are there when you move in and you live there ten years. The sun beats down on the drapes every day. By the time you leave, the drapes are faded, but it鈥檚 not your responsibility, it鈥檚 the sun鈥檚. On the other hand, if your cat uses the drapes or the rug as a scratching post for ten years, then you are responsible.

STUBBORN LANDLORD

If your deposit is not returned to you within 21 days, or if you do not agree with the amount that has been withheld, or if your landlord has not paid you interest: Send a letter to your landlord requesting the money and refer to the security deposit law. (San Francisco Administrative Code Chapter 49 for non-payment of interest). Keep a copy of all correspondence. If your landlord does not respond within a reasonable time, you can sue in Small Claims Court (see info below).聽

Small Claims Court is like those court programs on TV. No lawyers are allowed. You and your landlord will both have an opportunity to present your cases. You should bring all written documentation, inspection reports, rental agreements, receipts for deposits paid, and photos that will help prove your case. You can sue your landlord for statutory damages of twice the amount of deposit for bad-faith retention of the deposit:. The maximum you can sue for in Small Claims Court is $12,]500. For more information, call or drop in at the , 400 McAllister, room 509, (415) 551-5880.

UPON MOVE-IN

Get a receipt for your deposit. When you move in, take careful inventory of the condition of the place. Record any damage and check all equipment to ensure that it works properly. If possible, take photos of existing damage to ensure that you will not be blamed for it. Have the landlord or manager sign and date your inventory list and keep a copy.

INCREASING DEPOSITS DURING TENANCY

Sometimes a landlord will try to increase the amount of money you have on deposit during your tenancy. State law does not address this issue. Check your lease. If you have a fixed-term lease, the landlord may not raise the security deposit unless the lease allows for it. If the security deposit already adds up to whatever you were required by law to pay at the time, then the security deposit may not be increased.

SALE OF PREMISES

Landlords who sell their buildings are required to either transfer the security deposits to the new owner or return the deposits to their tenants. If deposit is transferred to the new owner, the old landlord must give the tenant a document stating the amount of the transfer and the new owner鈥檚 full name and address.

MOVING OUT

Whether you are on a month-to-month tenancy or at the end of a fixed lease, the law requires that you give a thirty-day written notice before you move out. If you have not paid last month鈥檚 rent ahead of time, you should pay it with your notice. If you move out without giving notice, your landlord may be entitled to deduct 鈥渦npaid rent鈥 from your deposit. If you move out without giving notice and the apartment is re-rented right away, the landlord must return your rent from the time that a new tenant occupies the apartment. mandates that a landlord notify a tenant of the option of having an initial inspection two weeks before terminating a premises in order to identify problems (and possible deductions from the security deposit) and be given a chance to rectify them and avoid any deduction.

A practical example of this: Tenant Juan gives landlord Jill a 30-day notice that he is leaving March 1. Within a reasonable time after receiving the notice, Jill should contact Juan in writing and schedule an initial inspection at which Juan can be present. If Juan agrees, the inspection happens (no earlier than two weeks before the end of the tenancy and with a 48-hour notice) and Jill gives Juan an itemized list of what problems exist. Juan then has time to fix the problems and avoid deductions. Then, before he leaves, Jill walks through with him again and signs off on the repairs he has done.

BREAKING A LEASE

If you are moving out before the end of your rental agreement, notify your landlord in writing as soon as possible. You are responsible for paying rent on the apartment聽 until the end of the 30-day notice. The law requires landlords to make all reasonable efforts to rent the apartment to another tenant at the best possible price (i.e., mitigate their damages). You should also help to mitigate the landlord鈥檚 damages by trying to find another tenant: put a notice on Craig鈥檚 List and signs in cafes and other places. Once the landlord re-rents the apartment, your obligation to the landlord ends.

LAST MONTH鈥橲 RENT

If you were required to pay for the last month鈥檚 rent before moving in, check your lease to determine what you have actually paid for. If the lease says 鈥渟ecurity for last month鈥檚 rent,鈥 then you have not actually paid for the last month鈥檚 rent, but just provided security for it, and must pay your rent on time as usual. If the rent has been raised, you must pay the difference between the final rent and the security for last month鈥檚 rent. If the rental agreement simply says 鈥渓ast month鈥檚 rent,鈥 then you have paid for last month鈥檚 rent and do not have to pay it again. You鈥檙e not responsible for the differential amount caused by a rent increase.

DEPOSIT FOR LAST MONTH鈥橲 RENT

If part of your deposit was not specifically for last month鈥檚 rent, then you are required to pay rent for the last thirty days you live in the apartment. Write a letter to your landlord a month or two before you leave asking them if you could apply your deposit towards last month鈥檚 rent. Offer to have the landlord inspect the apartment for damages before you move out. If the landlord refuses, then pay the last month鈥檚 rent.

If you have to file in, you should know that it is relatively simple. No attorneys are allowed. The best comparison is to one of those TV court programs. You present your case, the landlord presents theirs. The judge decides. Small Claims can be used for a whole host of tenant problems, including decrease in services, illegal rent increases, etc. To file, go to the courthouse at 400 McAllister St./Polk during regular business hours or check the superior court website online. The cost of filing for Small Claims is based on how much you鈥檙e suing for, up to $75. The court offers fee waivers if you are low-income. So you should ask for them. For help with filing in Small Claims, check out the:

400 McAllister, room 509
San Francisco, CA 94102
Information line: (415) 551-5880

For help with tenant issues:
Monday, Tuesday and Thursday (1:30-4PM)