Landlord-Tenant Security Deposit Attorney

Because most leases include a provision requiring tenants to pay a security deposit before occupying the property, issues involving security deposits are among the most common that Minnesota landlords and tenants face. Despite being common, there are many misconceptions about how security deposits are treated and the rights of landlords and tenants involved. Below are several common questions that Minnesota landlords and tenants ask about security deposits.

When Can a landlord keep the deposit?

A landlord can keep a security deposit for damage to a rental unit, as long as that damage is beyond “normal wear and tear.” For example, a landlord may be able to deduct from a security deposit if a tenant has broken holes in the unit’s walls, but would not be able to deduct funds for replacing a carpet that is old and worn out.

What is “normal wear and tear”

This is one of the most common questions and sources of dispute between Minnesota landlords and tenants regarding security deposits. Simply put, normal wear and tear is often decided on a case by case basis. Usually, normal wear and tear would include old items breaking or wearing out because of ordinary use. This is most often seen in carpeting or paint, where those items need replacement due to age. However, normal wear and tear does not include issues intentionally caused by the tenant such as issues needing more extensive repairs.

Does a Landlord Need to Pay Interest on the Security Deposit?

Yes. Minnesota law states that upon returning a security deposit, a landlord must pay interest as well at the rate of 1% per year. While this may not seem like much, interest on a security deposit can add up, especially for high-value deposits or for tenants who have lived at one residence for a long time.

Can a tenant use the deposit to pay for the last month’s rent?

No. Minnesota security deposit law specifically states that “no tenant may withhold payment of all or any portion of rent for the last payment period of a residential rental agreement…on the grounds that the deposit should serve as payment for the rent.” In fact, if a tenant fails to pay the last month’s rent and causes the landlord to use the security deposit for that amount, the landlord may evict the tenant and the tenant may face financial penalties for this violation.

What happens if a landlord does not return the security deposit?

A Minnesota landlord has three weeks to return the security deposit, or a statement providing why the deposit (or part of the deposit) is being withheld. If the landlord does not return the deposit or provide such a statement in that time period, a tenant can take the landlord to court. Landlords should be particularly careful with complying with this requirement, as a tenant can obtain damages equal to the amount they are owed. This means that if a landlord wrongfully withholds a security deposit of $1,500, they may end up being ordered to pay $3,000 to the tenant.

These are answers to just a few of the most basic questions concerning security deposit law in Minnesota. While simple on the surface, Minnesota laws concerning landlord and tenant use of security deposits are complex and provide ample room for a wide variety of disputes. Eviction attorney John E. Roach has extensive experience assisting landlords and tenants with security deposit disputes. If you have questions about how to handle a security deposit, or have become involved in a dispute over return or withholding of a deposit, call now for a free consultation.