A security deposit is money that the renter pays the landlord to cushion for any extra costs. It is refundable at the end of the lease term. Landlords in Roanoke require security deposits for a number of reasons.
Some of the reasons for requiring security deposits are to cover for:
- Any damage exceeding normal wear and tear that a tenant may have caused during their stay in the rental. Examples of these damages include broken tiles, holes in walls, and unauthorized paint colors.
- Lost rental income that results from property abandonment by the tenant.
- Missed rental payments. If a tenant owes rent as a result of them terminating the lease or rental agreement early, you can use the deposit.
- Any unpaid utility bills or unpaid rent that a tenant fails to pay after they move out.
Most states, including the state of Virginia, have security deposit laws that outline how exactly landlords should handle a renter’s security deposit. For instance, the amount a landlord can collect, what requirements a tenant must meet for its return, and when it should be refunded.
Virginia’s security deposit law is part of the Virginia landlord tenant law.
In this blog, we’re going to take you through the basic overview of the statewide security deposit laws that also apply in the city of Roanoke. As a landlord, understanding these laws is key to avoiding issues not only with your tenant, but also with the law.
Security Deposit Limit
The state of Virginia limits how much you, as a Virginia landlord, can charge as security deposit. The maximum amount you can charge is capped at 2X the price of rent. That means, if you charge a monthly rent of $1,500, then you cannot charge anything more than $3,000 as security deposit.
Interest on Tenant’s Security Deposit
Before 2014, Virginia law required landlords to deposit a renter’s security deposit in an interest-earning account. They were then required to pay out the interest earned to tenants that had lived in the same dwelling for at least thirteen years.
Today, however, this isn’t the case. Virginia passed a law in 2014 that removed the requirement of storing a tenant’s security deposit in an interest-accruing account.
Justifiable Reasons to Deduct Part or All of a Security Deposit
At the end of a rental term, Virginia landlords are required to return the tenant’s security deposit either in whole or in part. To get the entire security deposit amount, the tenant must return the unit in the same condition they found it.
Unfortunately, tenants don’t always get their full refund. Sometimes, they only get back a portion of their security deposit.
Some of the reasons for this include:
- Failure by the tenant to clear their utility bills.
- Breaking the lease early. A lease is a contract, and both parties are required to uphold its terms until the end. Generally speaking, if a tenant breaks it early, there are repercussions. Among them is the requirement to continue paying the rent still due under the lease or rental agreement. If they don’t, the landlord has a right to deduct the appropriate amounts from the security deposit.
- Damage caused by tenant negligence. Examples of excessive damage includes a carpet soaked with pet urine, damaged or missing door locks, a broken toilet seat, and a smashed bathroom mirror.
In all the aforementioned cases, as a Virginia landlord, you have the right to make appropriate deductions from their deposit. In such cases, the law requires you to notify the tenant within 30 days of making that determination. It goes without saying that the notice must be written.
If, however, the deduction is made 30 days before the tenant moves out, then there would be no need to notify the tenant.
A walk-through inspection is required in the state of Virginia. You must make reasonable efforts to ensure the tenant is present. The law requires that you notify them within 5 days upon receiving their written notice to move out or when you give them a written notice to vacate.
If the tenant wishes to be present, then they must respond in writing. Next, you will then need to schedule the inspection within three days after the tenant moves out.
During the inspection, you must then itemize the list of deductions and give them to the tenant.
Security Deposit Records
You must keep all records of a tenant’s security deposit. If there are any deductions, then you must maintain a record showing a list of itemized deductions over a period of 2 years.
Returning a Tenant’s Security Deposit
Under Virginia law, you must return a tenant’s security deposit within 45 days of them moving out.
If deductions need to be made, you must include:
- The amount of security deposit you are returning
- An itemized list of deductions, including the exact damages caused as well as their repair costs
You can send the notice to the tenant via hand delivery or certified mail.
Change of Rental Property Ownership
If the rental changes hands while the lease is still active, then it’s the responsibility of the incoming landlord to let the tenant know. It’s also the responsibility of the incoming landlord to make sure that the outgoing landlord transfers to them all the tenants’ security deposits.
Abiding by the Virginia’s Security Deposit Laws
As a Virginia landlord, it is crucial that you follow the state’s laws when handling a tenant’s security deposit. Failure to follow all the provisions of the law could result in penalties.
Self-managing a rental unit may not be a good idea. You may not know how to find desirable tenants, maintain your property, ensure consistent rent collections, or even understand the Virginia landlord tenant law, including the Virginia security deposit law. Luckily for you, JMAX can help!
We have the experience needed to help you handle all your rental management needs. We can help you realize your investment goals. Get in touch with us today!
Disclaimer: This article is in no way a substitute for legal advice from a qualified attorney in Virginia. Virginia landlord tenant laws may change, and this post might not be updated at the time of your visit.