Security Deposit Return - Albany and the Greater Capital District
In 2019, the law surrounding the return of security deposits was amended. These changes can be found in New York General Obligations Law § 7-108.
After the lease is signed but before the tenant moves in, the landlord must offer the tenant the opportunity to inspect the premises with the landlord (or his/her agent) to determine the condition of the property. If the tenant opts for the inspection, then the landlord and tenant must execute a written agreement outlining the condition of the property and noting any existing defects or damages. This agreement must be executed before the tenant moves in. (General Obligations Law § 7-108(1-a)(c)).
When the landlord receives notification from the tenant that he/she is terminating the tenancy, the landlord must notify the tenant in writing of his/her right to request and be present for an inspection prior to vacating the property. The landlord is excused from providing this notification if the tenant fails to provide notice that he/she is terminating the tenancy at least two weeks in advance. If the tenant opts for the inspection, then the landlord must schedule the inspection “no earlier than two weeks and no later than one week before the end of the tenancy” and must “provide at least forty-eight hours written notice of the date and time of the inspection.” (General Obligations Law § 7-108(1-a)(d)).
Once the inspection is complete, the landlord must provide the tenant with “an itemized statement specifying repairs or cleaning that are proposed to be the basis of any deductions from the tenant’s deposit.” The tenant then gets the opportunity to “cure any condition before the end of the tenancy.” (General Obligations Law § 7-108(1-a)(d)).
The landlord is required to provide the tenant within 14 days after he/she vacated the property, “an itemized statement indicating the basis for the amount of the deposit retained, if any, and shall return any remaining portion of the deposit to the tenant.” (General Obligations Law § 7-108(1-a)(e)).
A landlord cannot keep any amount of the security deposit for costs relating to “ordinary wear and tear of occupancy or damage caused by a prior tenant.” However, a landlord can retain part or all of the security deposit for costs due to “non-payment of rent, damage caused by the tenant beyond normal wear and tear, non-payment of utility charges payable directly to the landlord under the terms of the lease or tenancy, and moving and storage of the tenant’s belongings.” (General Obligations Law § 7-108(1-a)(b)).
If the landlord does not provide the tenant with the itemized statement and security deposit within 14 days, then the landlord forfeits any right to retain any portion of the security deposit. (General Obligations Law § 7-108(1-a)(e)).
If the tenant disputes the amount of the security deposit being kept by the landlord and commences an action in court, the burden falls on the landlord to prove the reasonableness of the amount retained. (General Obligations Law § 7-108(1-a)(f)). If the Judge finds that the landlord “willfully violated” General Obligations Law § 7-108, then the landlord could be found liable for punitive damages of up to twice the amount of the security deposit. General Obligations Law § 7-108(1-a)(g)).