Throughout your time as a landlord, you’ve likely come across tenants that treat your property with little regard for basic cleanliness or respect – it’s why you request a security deposit at the beginning of any tenancy.
Inevitably, you will need to repair damages to your unit from time to time, and if the damage is severe, you will be able to use a tenant’s security deposit to help pay for those repairs.
In most jurisdictions, a landlord is responsible for covering the costs of repairing “normal wear and tear” on their dime.
So, legally speaking, what can a landlord deduct from a security deposit?
Difference Between Excessive Damage and Normal Wear and Tear
You’re within your legal right to withhold a tenant’s security deposit to help pay for anything beyond the normal wear and tear definition in your lease agreement or as the law defines this term.
Normal wear and tear may seem like a subjective concept, so it can be challenging to know what you can and cannot charge a tenant to repair.
Courts generally recognize normal wear and tear as any damage associated with the regular use of an object – in this case, your rental unit.
If a doorknob has scuffed up the wall behind it or the sun has faded those lovely curtains, all of that would qualify as the normal wear and tear of everyday use.
Excessive damage would be the destruction or deterioration of your rental unit resulting from intentional behavior or negligence (and should be grounds for beginning the eviction process immediately).
What Can a Landlord Deduct from a Security Deposit?
As a rule of thumb, you should only deduct unpaid rent/utilities and the repair costs for excessive damage.
You would be within your right to withhold your tenant’s security deposit to cover the cost of repairing issues like:
- Cigarette burns on the carpet
- Broken mirrors in the bathroom
- Visible pet stains
- Claw marks on wooden floors
- Filthy or irreparably broken appliances
- Large holes in the wall
You would not be allowed to deduct money from a security deposit to help pay for normal wear and tear damage such as:
- Minor dents or scratches on the wall
- Discoloration from sun exposure
- Chipped or peeling wood varnish or paint
- Lightly dirtied carpet from standard use
- Loose tiles or linoleum
- Rusted plumbing fixtures
Use your best judgment when determining whether or not you should deduct from a security deposit.
Some landlords attempt to skirt the rules and wrongfully use a tenant’s deposit to replace old or worn-out appliances.
Unless it is clear that your renters intentionally damaged them, this could be against federal and state law.
The U.S. Department of Housing and Urban Development (HUD) has a helpful guideline for determining the life expectancy of certain modern appliances.
Performing a Rental Inspection
You’ll need to perform a rental inspection to determine what you can deduct from a security deposit.
We recommend following this process:
- Perform the inspection as soon as possible after the move-out date.
- Bring a notebook and a camera to document your findings.
- Send a list of all the damages in your rental unit, with an itemized statement of the charges.
Landlords are legally required to send the remaining portion of a tenant’s refund and notification of the deductions in nearly every state.
Understand what damages you’re allowed to deduct from a security deposit, or you may find yourself paying your tenants up to 3 times the deposit amount, depending on your location.
Repairing Excessive Damage vs. Maintenance of Normal Wear and Tear
Routine maintenance of your rental unit should be standard operating procedure before and after any tenancy.
Never charge a previous tenant for regular maintenance of normal wear and tear or any service you typically pay to have done, like professional cleaning.
Determine which of these two rental situations would be considered normal wear and tear:
- Tenant A has only rented your unit for six months. The carpet has mildew and the children’s bedroom walls display crayon markings.
- Tenant B has been renting from you for multiple years. The entry carpet shows wear from foot traffic, and the bedroom paint is faded and dingy.
Tenant A has clearly let your rental unit fall into disrepair in just a few short months. It would be best if you had them cover the cost of repainting the walls and replacing the mildewed carpet.
Tenant B has lived in your unit for years, and at that point, a fresh coat of paint and new carpet should be considered maintenance of normal wear and tear.
When determining whether any damage is excessive or simply from normal wear and tear, ask these questions:
- How long did the tenant rent your unit?
- Does the damage to the floor, walls, or any other item seem excessive for that period of time?
- Did your cleaners or repairmen state that their job was extraordinarily difficult in any parts of your unit?
As with anything, use your best judgment and err on the side of caution when charging your tenants for repairs.
You may deduct any extra fees that a professional service might charge – for instance, paying more to clean a filthy unit.
How to Protect Yourself
There are various ways a landlord and a tenant can avoid a dispute that might end up in small claims court.
As a Landlord
Thoroughly examine your state’s landlord-tenant state laws.
Each state has a unique set of rules and regulations that govern how a landlord may conduct their operation.
Any misstep could result in forfeiting your right to retain any portion of the security deposit or potentially hefty fines. Protect yourself and make sure that you:
- Document and photograph all damages that you expect to repair
- Aren’t charging for normal wear and tear
- Provide receipts for all deductions
Use a rental inspection checklist to note the condition of all rooms as part of your move-in and move-out inspection.
Suppose you are an owner of an affordable housing unit (commonly referred to as Section 8). In that case, there are restrictions on how much a landlord is permitted to request for a security deposit.
Due to that fact, HUD offers financial reimbursement to Section 8 property owners in the event of a financial loss through a special claims process.
As a Tenant
You won’t have to worry about normal wear and tear once you decide to move out.
However, if you have caused any excessive damage, it’s best to go ahead and repair it since the costs will be deducted from your security deposit anyway.
Generally, all landlords will submit a statement informing you of the reason for their deductions and the amount that they charged you.
To avoid being surprised by any unexpected charges, you can request a walk-through inspection with your landlord before your move-out date.
You might discover a significant problem that went unnoticed during your tenancy yet will still be considered excessive or the cause of negligence– like water-stained floors underneath a window or mold growth in a rarely used cabinet.
Organizing your entire move with a checklist, or requesting a walk-through inspection and filling out a rental inspection checklist, will help make sure that both you and your landlord are on the same page.
Every landlord needs to know what is considered normal wear and tear and how it differs from excessive damage.
Nearly all legislatures have determined that a landlord is responsible for maintaining normal wear and tear, and tenants should not pay erroneous repair fees.
That said, tenants should not take advantage of landlords and should pay for excessive damage to a property.