How to Handle Security Deposit Disputes

Security deposit disputes are generally of three types: (1) The landlord has not returned the deposit, even after the tenant has sent a demand letter. (2) The landlord has not returned the full deposit and you feel that the deductions, such as for damage to or cleaning of the rental unit, are unjustified. (3) The landlord has violated another state security deposit law, such as requirement that tenants receive interest on the deposit. Here's how to take action.

Call or Email the Landlord

Find out why your concern has not been addressed—maybe the landlord is waiting for some repair work and doesn't know how much to deduct from your deposit for the repairs. Write down the date and time of your call and the specifics of the conversation, and keep copies of any emails to and from the landlord. You may need these if you end up suing your landlord in small claims court.

Send a Second Written Demand Letter

If you are dissatisfied with the landlord's response, write another demand letter explaining the specifics of your situation, including how much money you believe your landlord owes you. Conclude by stating that you will file a small claims court suit if the landlord does not return the deposit. Keep a copy of this letter.

Sue Your Landlord in Small Claims Court

If you don't get a satisfactory response from your landlord, or can't work out a compromise, most states allow you to file a small claims case immediately. Some states require that you try mediation first (you and your landlord meet with a neutral third person who helps you reach a solution). You can sue your landlord for your security deposit refund, including interest (if your state or city requires interest payments on deposits). All states limit the amount for which you can sue in small claims court (it's usually about $3,000 to $7,500).Check your state claims court for information on limits and other rules.

Small claims court cases are inexpensive (typically less than $50 to file a case); don't require a lawyer; and typically go before a judge (there are no juries) within a month or two. To prepare for trial, pull together the following material: copies of your state security law, any local rules that apply, your lease or rental agreement, your demand letter, and any other communication with the landlord; a statement of how much money your landlord owes you; tangible evidence (the more the better), such a video of your apartment after you left showing that it was in good condition. Your small claims court will probably have helpful information on how to prepare your case.

At the trial itself, you and your landlord will each briefly explain your point of view and present any evidence or witnesses. The judge will make a decision on the spot or mail it out a few days after the trial.

Learn more about Security Deposit Laws.

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