For NYC renters, the process of finding an apartment and signing the lease is troublesome enough as it is. You will also be asked to pay the first and last month’s rent, and security deposit. As long as you leave your apartment in the same condition, you found it you should have little trouble getting your security deposit back.
However, sometimes it’s not that easy, and you may have a struggle on your hands to get your money back. Here’s what you need to know about security deposits in NYC and how you can make it back.
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Why would my security deposit be withheld?
The only grounds a landlord has for withholding all or part of your security deposit is:
- For the cost of wear and tear to the apartment
- Payment for unpaid rent
If you need to break your lease, it’s unlikely that you’ll get your deposit back. The reason being that it’s likely there will be a gap between you and the new tenant. The exception would be if you sublease your apartment and pass on the deposit cost to them. Also, if the landlord finds another tenant immediately you will still be owed your rent.
Unless if the lease stipulates that any break in the lease results in loss of the deposit.
Who owns the security deposit?
On signing the lease and handing over your deposit, it is supposed to be held in trust by the landlord. It should not be commingled, with the landlord’s money, and the name and address of the bank in which it is kept should be included, in the lease, the account number and amount plus interest. The bank must also be located, in NY State.
If you are renting in a building with six or more units your deposit must be placed in an interest-bearing account.
The only catch is that the landlord is entitled to keep one percent of the deposit amount each year as an administrative fee. You have three options in how you handle this interest. You can withdraw it, use it to pay part of the rent or leave it in the deposit account.
How can I ensure I get my security deposit back?
There is no full-proof way to ensure you get your deposit back. But you can better protect yourself by doing the following:
Carefully read your lease
Before signing your lease agreement read it correctly to make sure you understand what your freedoms are as a renter. If you wish to make updates like painting or putting nails in the walls, make sure the lease allows it. Any violations of the lease will be held as grounds for withholding the deposit.
On both your first and last day do a walkthrough of the apartment, preferably with your landlord, and makes notes of the condition. Take pictures as proof that you found the place in a certain way.
What if my landlord won’t return my deposit?
The landlord; is allowed to hold the deposit for a; “reasonable” amount of time. This usually means 30 days or can be longer depending on what the lease states. If your landlord refuses or doesn’t reply write a letter demanding it back.
Have it sent in a way that guarantees receipt; such as FedEx or certified mail; threatens to sue or file a complaint with the NYS Attorney General’s Office.
If the amount in dispute is under $5,000, a small claims court is your best choice. If over $5,000, you should hire a lawyer. Legally speaking, the onus is on the landlord to provide proof of damages that warrant withholding the deposit. As always, consult a lawyer if you are unsure of your rights.