Education for Justice FACT SHEET H-29 Fall 2009

SECURITY DEPOSITS

HOW SOON DO I GET MY DEPOSIT BACK?

The landlord has to send you the full deposit with interest or a written statement of why they are keeping your deposit. They have to send this within 21 days of your move-out date. If the building was condemned, and it was not your fault, the landlord has to return the deposit within 5 days. Make sure the landlord has your new address.

HOW MUCH INTEREST DO I GET?

1% per year. Let’s say you moved in August 1, 2008. Your move out was April 30, 2009. Your deposit was $900.00. This means you have to figure out 1% interest for 9 months. First, figure out the interest for a year, and then divide it to get the interest for each month.

$900.00

x .01 (1% = .01)

$ 9.00 Is the interest for 1 year at 1%.

To get the interest for each month you have to divide the year amount by the 12 months in the year:

$ 9.00 ÷ 12 (months) = $ .75 (75 cents) This is the interest for each month of a year at 1%.

August 2008 through April 2009 is 9 months, so multiply the monthly interest by 9:

$ .75 Interest per month

x 9 Number of months there

$6.75 Is the total you should get back with your deposit.

So, $900 deposit, plus the interest ($6.75) means you should get $906.75 back from your landlord.

If you have lived in your apartment or house since before August 1^st 2003, it’s trickier. Before August 1^st 2003, the interest on a security deposit was 3%. So you need to figure out the interest per month for the months before August 1^st 2003 separately. Follow the same steps as above, but in the first step multiply the $900.00 by .03 (3%). Then follow the rest of the directions. You will need to add the 2 interests (the months at 1% and the months at 3%) together at the end for the total interest coming to you.

WHEN CAN A LANDLORD KEEP THE DEPOSIT?

A landlord can keep your deposit money for:

· Unpaid rent or other fees that you agreed to – for example, replacing lost keys. But Minnesota law generally does not let you use your security deposit for the last month’s rent unless you are a tenant in a building in foreclosure. See our fact sheet When Your Landlord Loses the Building for more information.

· Money needed to repair damage you caused, but not ordinary wear and tear.

· Lost rent if you moved out without giving proper written notice. In this case the landlord can probably keep the whole deposit. If they can re-rent it quickly, you can argue that the landlord did not lose a full month’s rent.

Your landlord can only keep the amount that these things cost, not all of the deposit if there is some left over.

WHAT IS “ORDINARY WEAR AND TEAR”?

Ordinary wear and tear are things like worn-out carpet, chipped paint, and appliances that break because they are old. You should not have to pay for these things.

WHAT IF THE LANDLORD WON’T RETURN THE DEPOSIT?

Start by writing the landlord a letter. Be sure to write the address the deposit should be sent to. Explain why you deserve the deposit back. Keep a copy of the letter.

WHERE DO I SUE FOR MY SECURITY DEPOSIT?

· Sue in Conciliation Court. Every county has one for cases up to $7,500. You do not need a lawyer.

· Go to the courthouse in the county where the rental property is or where the landlord lives. Fill out a complaint form with the landlord’s name and address, the money damages you want, and a short explanation of your case.

· There is a small fee. You don’t need to pay it if you have a low income. Ask the court clerk for an IFP (inability to pay) form.

WHAT MONEY DAMAGES SHOULD I ASK FOR?

· You can ask for rent back if the apartment had housing code violations.

· Ask for your deposit, plus interest, plus any filing fees or costs you have in bringing the case to court.

· If the landlord doesn’t send you an explanation within 21 days (or 5 days if your place was condemned), the law gives you a “penalty” equal to the amount you are owed. Ask to get this penalty amount.

· If the landlord shows “bad faith,” you can get additional “punitive damages” (money) up to $200. “Bad faith” means that they knew they owed the money but kept it anyway. If the landlord does not send you an explanation within 21 days, the court should assume “bad faith” unless the landlord can prove good faith.

WHAT IS A COUNTERCLAIM?

The landlord can file a counterclaim saying that you owe money. For example, they might say that you did $1,000 damage to the place, and that your security deposit only covers $800 of it. The court will hear the counterclaim at the same time as your claim.

HOW SHOULD I PREPARE FOR COURT?

· Get your evidence together. If you have written documents, like a lease, rent receipts, or letters to the landlord, make copies for the court.

· If you have photos of the apartment that you took just before you left, bring them to court.

· Bring witnesses – people who saw the place when you moved in and when you moved out. They can testify that you took good care of it.

WHAT IS A SETTLEMENT?

A settlement is an agreement between you and the landlord to end the lawsuit. A settlement is often best. Even if you win in court, you may have a hard time collecting the money. An agreement that pays you right away may be smart. Make sure that any settlement is in writing, signed, and dated. Take it to your hearing and have the court approve it.

WHAT SHOULD I DO NEXT TIME I RENT?

· Before you move in, do an inspection with the landlord. Write down any problems with the apartment, and any areas that are dirty or damaged. Have the landlord or caretaker sign the list. Ask them to make all the repairs before you move in. See our fact sheet, Looking for an Apartment.

· Give proper written notice before you move out.

· When you move out, do a move-out inspection just like the move-in inspection. Have the landlord sign the list. Then you’ll have proof that you left the unit clean.

· Be sure you return all keys (get a receipt for them), remove all of your belongings, leave the apartment clean and free of garbage, and give the landlord a mailing address in writing. Take photos of how clean you leave it. Have a witness look at the apartment.

WHAT IF MY LANDLORD SELLS THE BUILDING?

If the landlord sells, and you are still living in the building, they have 60 days to return your deposit or notify you that they are giving all or part of it to the new owner. They can deduct for unpaid rent and charges for damage to the apartment. If the letter says that the old landlord is keeping part of the deposit, you have 20 days to send an objection to the new landlord. If they don’t change how much of the deposit the old landlord turns over, you can sue the old landlord in Conciliation Court. If the old landlord does not turn over any of your deposit to the new owner, the new owner can ask you to pay a new deposit.

Minneapolis Legal Aid – CLE MN Legal Services Coalition 2324 University Avenue W. – Suite 101B St. Paul, MN 55114

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