Many tenants as well as landlords don't know that Maryland law imposes strict obligations on handling security deposits on residential leases.
A landlord who fails to comply with the law may be liable to the tenant for up to three times the security deposit withheld plus reasonable attorney's fees.
Here are some frequently asked questions about security deposits:
What is the maximum amount a landlord can charge as a security deposit on a residential lease?
A security deposit cannot exceed two months' rent per dwelling unit, regardless of the number of tenants. A security deposit includes payment of the last month's rent in advance.
Is a residential tenant entitled to a written receipt for a security deposit?
Absolutely. The landlord must provide a written receipt for a security deposit, which notifies the tenant of his rights under the security deposit law.
The security deposit receipt must notify the tenant of:
Tenant's right, upon prior written notice to the landlord, to have the dwelling unit inspected by the landlord in the tenant's presence and to make a written list of damages that exist at the commencement of the tenancy.
Tenant's right, upon prior notice to landlord, to be present when the landlord inspects the premises at the end of the tenancy to determine if damage was done.
Tenant's right to receive a written list of charges against the security deposit claimed by the landlord; the list must be sent to the tenant's last known address within 45 days after termination of the tenancy.
Landlord's obligation to return any unused portion of the security deposit within 45 days after termination of the tenancy.
A statement that the landlord's failure to comply with the security deposit law may result in the landlord being liable to the tenant for a penalty of up to three times the security deposit withheld, plus the tenant's reasonable attorney's fees.
Landlords are required to retain a copy of security deposit receipts for two years after the lease terminates. A landlord who fails to provide a tenant with a security deposit receipt is liable to the tenant for $25.
Can a landlord commingle security deposits with the landlord's own funds?
Definitely not. Security deposits must be kept separate from the landlord's operating or personal bank accounts. Security deposits must be segregated in a federally insured bank or invested in securities issued by the federal government or the state.
