Security deposit rules for California landlords

At MT Evictions, we have been inserted into the fray of many landlord-tenant disputes, and one
of the most common points of contention are security deposits. When tenants decide
to leave, you can be assured one of the first things on their mind – even before how to
get the sofa around a tight corner – is how and if they are going to get their security

A little bit of trivia: Security deposit disputes are the #1 reason rental property owners find
themselves in Small Claims Court, but being dragged there is not so trivial. It's important to
understand the rules relating to security deposits, which are codified in California Civil Code §1950.5.

What is the maximum security deposit that can be demanded?

The maximum security deposit is up to two times the monthly rent if the rental unit is
unfurnished and up to three times the monthly rent if the unit is furnished. Landlords
are entitled to ask for additional half-month’s rent when the tenant has a waterbed.

What can the security deposit be used for?

There are many shapes and forms of deposits. They can be called last month's rent deposits, pet deposits, key deposits, and others, but don't let these names fool you. Under the law, they are considered the security deposit period, and cannot exceed legal limits when they are all added up.

Also, keep in mind that certain courts have said itemized deposits can only be used for its stated
purpose. For example, pet deposits can only be used for the damage that Fluffy wreaked in the
apartment, and not for any other damages unrelated to the pet. To avoid exceeding the
statutory maximum and ensure the deposit can be used towards any loss, many attorneys advise
having a single security deposit.

A word about “non-refundable” deposits

If you have non-refundable” deposit, for example, an automatic deduction for flea spraying if a
pet was on the premises, this flies in the face of the law. When a tenant complies with the lease
terms, he or she is entitled to all of the security deposit back.

A few words about inspections

By doing a walk-through inspection with incoming tenants will go a long way in depicting the
“before and after” condition of the property, and documentation is key.

Fast-forward to the pre-move out when the tenant is on his or her way out the door.
The inspection can occur no later than two weeks before the date of vacating the premises and
requires 48 hours written notice, unless waived.

The tenant is entitled to be present during the inspection and can remedy any donut holes that
would result in a deduction of their security deposit. After the pre-move out inspection, the tenant may remedy any identified deficiencies that would otherwise result in deductions in the security deposit.

The landlord can deduct any damages that exceed “normal wear and tear,” but this is is an
ambiguous term. What exactly, is normal wear and tear? That's a topic we'll take up in
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