Whether you will receive interest on your security deposit depends on state law and your apartment. If your state requires landlords to pay interest to tenants on paid security deposits and your apartment complex fits within the purview of the law, you will likely receive interest on your security deposit within a few weeks after moving out.
States that Require Interest Payments
Less than a third of states require landlords to pay interest on security deposits. These states are:
- New Jersey
- New Mexico
- New York
- North Dakota
When Interest Is Required
States, however, do not require every landlord to pay interest. Landlords that manage multiple units or large apartment complexes are usually governed by the rule. Most times, there is a minimum number of units (for example, ten) that a landlord must manage to be held accountable under the rule.
Landlords that manage a single unit usually do not need to pay interest. Therefore, if your landlord manages only your unit or if you live in a small apartment complex, you are unlikely to receive interest on your security deposit.
In other states, interest is only required on security deposits more than $50.00. The amount of your security deposit is the amount you pay and not the amount that is typically charged. Therefore, if you received a break on your security deposit and paid $50.00 instead of the normal $200.00, you would not receive interest on your deposit.
How Much Interest You Receive on Your Security Deposit
How much interest you receive depends on the bank or legislature. Sometimes, the legislature will establish the amount of interest, which typically ranges from 1 to 3% of the deposit amount. If the legislature has not established an amount, you will receive whatever percentage rate the depositing bank pays, which is again typically 1 to 3%.