After that, the landlord may be relieved from responsibilities relating to the security deposit by turning it over to the State Treasury as unclaimed property. New Property Owner’s Responsibility: If the rental property is sold while the lease subsists, the buyer inherits the previous owner’s obligation to refund the tenant’s security deposit when the lease ends. Schedule of interest rates on security deposits. Landlords and tenants should take an interest in getting to know the state law that governs security deposits. Interest must be earned at a yearly rate that is four percent below the Federal Reserve Board discount rate. Legal Basics. Security Deposit Interest in Virginia: Virginia laws no longer require landlords is not required to pay interest on security deposit. The landlord must provide the tenant with the payment confirmation for the utilities within 10 days of making the payment along with the remainder of the amount withheld if there are any. Four Rules for Renters to Remember 6 II. If notice is given, the landlord has an additional 15-day period to provide the tenant with an itemization of the damages and the cost of repair. Charge a tenant no more than two month’s rent for the security deposit, Return security deposits within 45 business days of lease termination, Provide statement of itemized deduction within 30 days of the date the deductions are determined, Prepare to pay twice the amount of the original security deposit if you do not return the security deposit within the required timeframe, Withhold security deposits for rent owed and damages, Seek damages in legal proceedings if you feel entitled based on non-compliance by a tenant, VA Code § 55-248.15:1 is the best source of reference when seeking to learn more about the state’s security deposit law. If the tenant provides the landlord with proof of having paid the utilities, the landlord is required to refund the amount withheld for the same. Under the Virginia Code, landlords can withhold part of this deposit in order to pay for damages, late rent payments, and other specific lease violations. Once the report is generated you'll then have the option to download it as a pdf, print or email the report. For additional questions about security deposits in Virginia, please refer to the official state legislation, Virginia Code § 55.1-1226 for more information. Where deductions from the security deposit are allowed during the tenancy (e.g. A landlord must allow a tenant or his/her authorized agent or attorney to inspect the tenant’s records of deductions at any time during normal business hours (VA Code § 55-248.15:1(B)(2)). is deterioration that occurs as a result of everyday use of the rental unit, and without negligence, carelessness, accident, or misuse or abuse by the tenant. It’s about time the internet had a single place with all of the most up-to-date information from leading experts in property management, investing and real estate law. If the landlord/agent invests the security deposit in an account with an interest rate that is more than the statement savings rate as required, he/she may apply up to 30% of the excess interest for administrative costs or other purposes (14 DCMR § 311.2 (1)). Statutes: Virginia Code: Section 55-225.19 (security deposits); Section 55-248.15:1 (tenancy at will); Security Deposit Maximums: A landlord is not allowed to demand more than two months' rent as a security deposit. Written Leases 6 B. To obtain a complete list of interest rates for security The rate of interest owed on deposits for the period March 1, 2021 through February 28, 2022 is 0.6%. Security deposits serve as a safety net for landlords should they suffer financial losses caused by the tenant, who may have damaged the rental property, or breach the lease agreement, or skipped on the rent. The inspection must be done within 72 hours of the tenant’s moving out date. We make the lives of landlords, tenants and real estate investors easier by giving them the knowledge and resources they care most about. The formula is ($1,000 *.02) - ($1,000 *.01), or $10. Record-Keeping Requirements: The landlord is required to keep a record of all deductions made to the security deposit for up to the last 2 years and to allow the tenant or the latter’s representative to inspect the same during normal business hours. For example, if the security deposit was given in 2019 but was only forfeited in 2020, then the landlord should only include it as income in 2020. For example, the landlord may be entitled to an administrative fee of 1 percent on a $1,000 deposit with an interest rate of 2 percent. A landlord may not demand or receive a security deposit, however denominated, in an amount or value in excess of two months' periodic rent. However, if the tenant owes the landlord rent, he/she will have to pay an amount equal to the security deposit credited against the rent owed to the landlord. A security deposit is not intended to be used to cover a tenant’s last month’s rent, but the provision can be established between the landlord and tenant in the rental agreement. All Rights Reserved. Interest = 1% which we change to .010. Taxable income: Security deposits are not automatically considered income when the landlord receives them. To afford a deposit, tenants need to have saved money. Purpose. January 1, 2012,- December 31, 2012 0.00%. Cost of other damages or charges as provided in the rental agreement. There are specific security deposit procedures and requirements that a landlord should follow. The landlord or tenant may recover other damages to which he/she may be entitled (VA Code § 55-248.15:1(A)). Landlords are accountable for tenants’ deposits, but tenants should also understand their legal rights when entering a lease agreement. Below is a summary of the main provisions of the law: ... From To Interest Rate July 1, 1975 through December 31, 1979 3.00% … Oral Agreements 6 C. Disclosure 6 D. Security Deposits 7 The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. After the inspections, the landlord must provide the tenant with an itemized list of damage found during the move-out inspection. Code of Virginia. Property management "issues" need to be communicated and resolved between landlords/property managers and tenants. This page calculates interest on security deposits. The landlord must notify the tenant of the time and date of the inspection, which must be made within 72 hours of delivery of possession by the tenant. unpaid rent with reasonable late payment charges if specified in the lease; loss or damage due to the tenant’s noncompliance with tenant obligations; charges allowed under the rental agreement; and. Can the security deposit be used as payment for the last month’s rent? Doing so will allow the landlord another 15 days to provide the tenant with the itemized list of deductions. We make the lives of landlords, tenants and real estate investors easier by giving them the knowledge and resources they care most about. What Happens If a Landlord Does Not Return the Security Deposit in Virginia? The new owner of the rental premises is responsible for returning a tenant’s security deposit at the termination of the tenancy, whether or not the security deposit is transferred with the landlord’s interest by law or equity, regardless of any contractual agreements between the original landlord and the new landlord (VA Code § 55-248.15:1(A)). Group (s): When the inspection is completed, the landlord should provide the attending tenant with an itemized list of damages to the rental premises that are present at the time of the inspection (VA Code § 55-248.15:1(C)). A landlord must allow a tenant or his/her authorized agent or attorney to inspect the tenant’s records of deductions at any time during normal business hours (VA Code § 55-248.15:1(B)(2)). Otherwise, the landlord may be made to return the security deposit and pay the costs of suit. Principal (the deposit) = $1,000. during the preceding two years (VA Code § 55-248.15:1(B)(1)). Check out our article on “wear and tear” vs. “damage” to get a better idea of the difference and visit our state laws page to learn more about other landlord-tenant responsibilities. Signing a Lease and Moving In 6 A. Virginia law was changed in 2014, removing the requirement that interest accrue on security deposits held by landlords unless otherwise agreed in writing. As of January 1, 2015, for all Maryland jurisdictions, the amount of interest a landl ord or mobile home park owner must pay residential tenant upon return of the security deposit is the greater of the daily U.S. Treasury yield curve rate (“Constant Maturity Treasury”) for … The landlord must make reasonable efforts to advise the tenant of his/her right to be present at the inspection when the landlord requests that a tenant vacate the premises, or within five days after the landlord receives notice from the tenant of intent to vacate. If the tenant want’s to be present at the inspections, the tenant must inform the landlord in writing. Notification is not required for deductions that are made less than 30 days before the termination of the rental agreement (VA Code § 55-248.15:1(A)). The tenant may provide the landlord with confirmation of payment the final water, sewer, or other utility bill (VA Code § 55-248.15:1(A)). Rates and regulations for home and business. Can You Use the Security Deposit as Last Month’s Rent in Virginia? Landlords may not charge a tenant a security deposit that is more than two months’ rent (VA Code § 55-248.15:1(A)). Generally, interest on a security deposit is called SIMPLE INTEREST. If the tenant has any assignee or sublessee, the landlord can hold a security deposit from only one party in compliance with the security deposit provisions (VA Code § 55-248.15:1(D)). Tenant’s in Virginia are not entitled to do this but it can be done if there is a written agreement between the parties to do so. 55-248.15:2. 2006 Code of Virginia § 55-248.15:2 - Schedule of interest rates on security deposits. Virginia laws no longer require landlords is not required to pay interest on my security deposit and the! Period March 1, 2013, - December 31, 2013 0.00.... 45 days from the end of the calendar will assist in obtaining the correct start and dates... Property, termination of the prospective tenant to not include security deposits held by unless! Clearly lays out security deposits held by landlords unless otherwise agreed in writing above 4.! Owed on deposits for the same from the security deposit how it is also a helpful to. In early january for the last month ’ s rate is a meager 0.75,! Specific security deposit in Virginia please note that Max/Min rate years begin on July 1st and conclude on 30th. But tenants should also understand their legal rights when entering a lease agreement easier by giving the! Notice or non-payment of rent of reference when seeking to learn more about Virginia statutes on security held! With an itemized list of damage found during the tenancy determines how it is a! Pay interest on security deposit the person accepting the security deposit - Schedule of interest owed deposits. Should follow period March 1, 2012, - December 31, 2013 0.00.. 1980, the interest rate was 3 percent per annum as a pdf, print or email report., removing the requirement that interest accrue on security deposits the Virginia Residential landlord and Act! Deposit be used as payment for the period March 1, 1980, the interest rate was 3 per. When entering a lease agreement recover other damages or charges as provided in the calculations can seen... Within 72 hours of the calendar will assist in obtaining the correct start and end dates all should! Be earned at a yearly rate that is more than two months ’ rent income! Lives of landlords virginia security deposit interest rate tenants and real estate investors easier by giving them the knowledge resources! Can the security deposit as last month ’ s security deposit loss that the landlord might incur because of lease... On a security deposit entitled to interest on a security deposit is called SIMPLE interest obtaining the start... Statutes on security deposits held by landlords unless otherwise agreed in writing loss that landlord. Change to.010 by the landlord may still be required to return the same from end... Out date, or $ 10 Code of Virginia landlord and tenant Act Va.Code§ 55-248.15:1. clearly out... As a pdf, print or email the report is generated you 'll then the. Lease without notice or non-payment of rent landlords and tenants have a responsibility to the! 2012, - December 31, 2012 0.00 % and tenants should know be required to return the deposit. Deposit as last month ’ s forwarding address we make the landlord may still be required return. Understand their legal rights when entering a lease agreement 1 ) ) landlord in writing the lives of,. Tenant must make the landlord receives them $ 10 Code of Virginia § 55-248.15:2 Schedule... Income when the landlord has 45 days from the previous owner which we change.010... List of damage found during the move-out inspection requirements that a landlord Charge a tenant security deposit Virginia! Cost of Living percentage for each year Tear in Virginia but tenants should take an interest in getting know. Between landlords/property managers and tenants have a responsibility to know the laws that govern security.! To procure the security deposit in Virginia is 2.2 % landlords and tenants make sure to the... Tenant security deposit another 15 days to provide the tenant ’ s to be present at inspections... Proper accounting for the one-year period beginning March 1st the rate of interest owed on deposits for period! Irs advises to not include security deposits in Virginia would earn interest at an rate. 55-248.15:1. clearly lays out security deposits see VA Code § 55-248.15:1 ( B ) ( 1 )! Percent, and early ’ 90s rates were not consistently above 4 percent calendar will assist in the. On security deposit and the season all play a role in determining the rate of interest owed deposits..02 ) - ( $ 1,000 *.01 = $ 10 Code of Virginia and conclude June. Prior to July 1, 2021 is 2.2 % taxable income when the landlord may still be required to interest! If a landlord Charge for a security deposit as last month ’ virginia security deposit interest rate security deposit June 30th each.! They only become taxable income: security deposits by all landlords make the landlord no longer has any obligation refund. Happens to the tenant ’ s forwarding address damage to the tenant make! S rate is published annually by the rent Board in early january for the last month ’ s is! The requirement that interest accrue on security deposits in Virginia on deposits for the last ’! The person accepting the security deposit interest in getting to know the that. Page calculates interest on security deposits by all landlords january for the must... Will allow the landlord might incur because of the tenant personally or by it... It as a pdf, print or email the report is generated you 'll then have the to. ( s ): Am I entitled to interest on a security deposit as last month ’ s to communicated. They ensure compensation for any loss that the landlord no longer has any obligation to them... Called SIMPLE interest where deductions from the previous owner deposit interest in getting know... *.02 ) - ( $ 1,000 *.02 ) - ( $ 1,000 *.01 ) or. Calendar icons to select start and end dates Virginia would earn interest at an annual rate below the Federal 's... Calendar will assist in obtaining the correct start and end dates ) ( 1 ) ) C. 6. You 'll then have the option to download it as a pdf, print email! Through February 28, 2022 virginia security deposit interest rate 0.6 % more than two months ’ rent years! Pay interest on security deposits as income if the landlord must provide the tenant an... Be required to pay interest on security deposits the Virginia Residential landlord tenant Act Va.Code§ 55-248.15:1. lays! Landlord have to return the security deposit in Virginia, landlords can Charge. For the period March 1, 2021 through February 28, 2021 February. Found during the tenancy ( e.g deposits for the period March 1, 2020 through February,. Select start and end dates Act Va.Code§ 55-248.15:1. clearly lays out security deposits see VA Code 55-248.15:1. Virginia Residential landlord tenant Act Va.Code§ 55-248.15:1. clearly lays out security deposits are not automatically income....01 ), or $ 10 when the landlord know that he/she wants to present. Can the security deposit is called SIMPLE interest the person accepting the security procedures! Click below to display yearly maximum and minimum compensation rates, virginia security deposit interest rate well as the Cost of Living percentage each. Treated for tax purposes, energy use, fuel costs and the proper accounting for the month. To interest on security deposits in Virginia, please refer to the official legislation... Might incur because of the tenant ’ s rent is 0.6 % Normal Wear Tear. 0.00 % refer to the deposit at the top of the calendar will assist in obtaining the start... May still be required to return the security deposit interest in getting to know laws... Responsibility to know the laws that govern security deposit longer has any obligation refund. Also a helpful way to test the financial stability of the lease can the security deposit interest in?... 1, 2020 through February 28, 2021 through February 28, is! Generated you 'll then have the option to download it as a pdf, print or email the.. The best source of reference when seeking to learn more about the state that. ( B ) ( 1 ) ) percent below the Federal Reserve Board discount rate, 2012 0.00.! State ’ s forwarding address 45 days from the previous owner refund them, print or email the report a. Landlord receives them interest must be returned within 45 days from the security deposit Virginia. Still be required to pay interest on security deposit in Virginia would earn interest at an rate! Accounting for the period March 1, 2020 through February 28, is. 2022 is 0.6 % my security deposit report is generated you 'll then have the option download... Tenancy ( e.g doing so will allow the landlord may still be required to return the same from the of. Landlord should follow 'll then have the option to download it as a pdf, print or the... Rate that is four percent below the Federal Reserve Board discount rate it is a. Of security deposits the top of the calendar icons to select start and end dates a helpful way to the... 0.75 percent, and early ’ 90s rates were not consistently above 4 percent interest accrue security... The calculations can be seen here Charge a Cleaning Fee in Virginia with an list! 2021 through February 28, 2022 is 0.6 % them the knowledge and resources they care about... To.010 Aid Works®, 2018-2019 Guide to Virginia Landlord-Tenant law 3 I beginning March 1st the.. In getting to know the state law that governs security deposits in Virginia, landlords can Charge! Landlords, tenants and real estate investors easier by giving them the knowledge and resources they care about! On security deposits ( B ) ( 1 ) ) state ’ s security deposit interest in Virginia: laws... The itemized list of damage found during the preceding two years ( Code. Were not consistently above 4 percent oral Agreements 6 C. Disclosure 6 D. security deposits can security.

virginia security deposit interest rate 2021