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July 26, 2017

Return of the Security Deposit: A Common Tenant Challenge

Representing a one-month rent payment, the security deposit amounts to a substantial cash outlay for renters. The financial stress basically doubles when tenants move from one rental unit to another because they typically have to pay a second security deposit for the new unit before receiving a refund from the landlord from the vacated premises.

All too often, tenants never receive that refund, and they believe that attempting to pursue it is a wasted effort. They may not even try to recoup their losses. Even though there are some valid reasons why a landlord is permitted to retain all or part of the security deposit, tenants have a right to receive a refund in most cases. A skilled Boston security deposit lawyer can often make a real difference in securing these valuable funds.

MA Law Pertaining to Security Deposits is Very Specific

In accordance with Section 16B in the MA General laws, tenants actually retain legal ownership of security deposit funds. Landlords must place the deposits in a separate bank account, issue a receipt to tenants within 30 days and pay back any outstanding security deposit funds plus interest within a reasonable time period when tenants move out.

Still, when the lease period ends, the law permits landlords to withhold all or a portion of a security deposit primarily for the following three reasons:

  • Unpaid rent: If tenants owe back rent — and they have no legal reasons for withholding it — landlords can offset the loss by retaining the security deposit.
  • Damage repair: Landlords can also withhold funds needed to make repairs to anything that the tenants damaged. This does not include damage that is deemed as reasonable wear and tear, and it also does not apply to repairs that are the responsibility of the landlord, such as plumbing.
  • Increase in real estate taxes: This only applies when the lease contains a tax escalator clause. In this case, landlords can potentially withhold an amount equal to tenants’ portion of property tax increases.

It should be noted that tenants actually can pursue security deposit refunds while they continue to live on the premises in certain cases. Perhaps the most common example of this situation is when a landlord fails to properly deposit the security deposit in accordance with all legal requirements.

Tenants Need to First Understand Their Rights to Protect Them

The information provided above can help tenants decide when to dispute a landlord’s failure to return the security deposit. However, a deeper understanding of the MA laws that pertain to tenant rights can reveal other conditions that merit pursuing security deposit refunds.

One month’s rent is a significant sum. Before giving up money that belongs to them, tenants should consider enlisting advice and support from a skilled attorney. Call us at (617) 848-4572 to learn if legal action can help.

Posted in Landlord-Tenant Information



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