It is important to note that these FAQs are not intended as a substitute for the definitions, interpretations, etc., contained in the respective rent regulatory statutes, codes, and regulations themselves, or any administrative or court decision construing such statutes, codes, and regulations, or any order of the New York City or County Rent Guidelines Boards.
- Does an owner have a right to collect a security deposit?
- When I renew my lease, do I have to also pay more towards my security deposit?
- Should I be getting interest on my security deposit?
- When I move out, how do I get back my security deposit?
- What are the time limits for returning security deposits?
- If my building is purchased, is the new owner responsible for my security deposit?
Does an owner have a right to collect a security deposit?
Yes, at the initial renting of the apartment to the tenant, the owner may collect a security deposit. The amount of a security deposit for rent regulated apartments can be no more than one month’s rent. The security deposit must be kept by the owner in an interest bearing account in a NYS bank. For further details, see HCR Fact Sheet #9: Renting an Apartment – Security Deposits and Other Charges.
When I renew my lease, do I have to also pay more towards my security deposit?
Yes. According to HCR Fact Sheet #9: Renting an Apartment – Security Deposits and Other Charges:
When a lease is renewed at a higher rental amount, or the rent is increased during the term of the lease, the owner can collect additional money from the tenant to bring the security deposit up to the new monthly rent. Even though a tenant may be exempt from paying a lease increase because of his or her Senior Citizen Rent Increase Exemption (SCRIE) or Disability Rent Increase Exemption (DRIE), the tenant must still pay the increased security.
Should I be getting interest on my security deposit?
The security deposit must be kept by the owner in an interest-bearing account in a New York State bank. The owner must notify the tenant of the name and address of the bank and pay the tenant the full annual interest, less 1% of the security deposit per year for the owner’s administrative costs. The tenant can choose whether the interest is to be subtracted from the rent, held in trust until the end of the tenancy, or paid in a lump sum at the end of each year.
However, be aware that with interest rates averaging below 1% in recent years, tenants may not be eligible to receive any interest at all.
When I move out, how do I get back my security deposit?
A security deposit should not be used as a final month’s rent. At the end of the lease, if the tenant honored the terms and conditions of the lease and left the apartment in the same condition as it was when initially rented, except for normal wear, the owner must return the full security deposit. If damage was done, the owner may apply part or all of the security deposit to the cost of repair.
If the tenant disagrees with the owner over the return of the security deposit or payment of interest, the tenant may begin a proceeding in Small Claims Court or contact the Consumer Frauds and Protection Bureau of the NYS Attorney General.
The Attorney General complaint form is in 3 versions:
What are the time limits for returning security deposits?
According to the Housing Stability And Tenant Protections Act of 2019, for tenants in non-rent regulated apartments:
Within fourteen days after the tenant has vacated the premises, the landlord shall provide the tenant with an itemized statement indicating the basis for the amount of the deposit retained, if any, and shall return any remaining portion of the deposit to the tenant. If a landlord fails to provide the tenant with the statement and deposit within fourteen days, the landlord shall forfeit any right to retain any portion of the deposit.
Information for rent regulated tenants can be found in HCR Fact Sheet #9: Renting an Apartment – Security Deposits and Other Charges.
If my building is purchased, is the new owner responsible for my security deposit?
Yes, the new owner of the building the landlord is responsible for security deposits. When a building is sold or title is transferred in foreclosure, the landlord must transfer all security deposits to the new owner within five days, or return the security deposits to the tenants. Landlords must notify the tenants, by registered or certified mail, of the name and address of the new owner. Purchasers of rent stabilized buildings are directly responsible to tenants for the return of security deposits and interest. This responsibility exists regardless of whether the new owner received the security deposits from the former landlord.
All leases will remain valid even if the building is transferred through mortgage foreclosure.
For more information, see the security deposit section of the NYS Attorney General’s website. If you live in a rent regulated apartment, you may also be able to file a complaint with NYS Homes and Community Renewal (HCR), the state agency which administers the rent laws.