In Virginia, landlords require security deposits as part of the move-in costs. The deposit acts like a safety net for landlords against financial ruin a tenant may cause during their tenancy.
The Virginia security deposit law is contained in the statewide landlord-tenant law.
The following is a basic overview of the state’s security deposit law. As a landlord, strict adherence is key!
Is there a limit to how much a landlord can charge as security deposit in the state of Virginia?
Yes, there is a limit to how much you can charge your Virginia tenants. The maximum you can charge is 2x the monthly rent. For example, if you charge your tenants a monthly rent of $1,500, then the most you can charge them as security deposit is $3,000.
How should a landlord store a tenant’s security deposit?
In the past, Virginia required landlords to store a tenant’s security deposit in an interest-bearing account. The annually earned interest would then be payable to tenants that had rented the property for more than 13 months.
Today, however, this is no longer the case. Landlords are free to choose where to store a tenant’s security deposit.
When can landlords make a deduction to the security deposit?
Virginia landlords can deduct all or a portion of the tenant’s security deposit for various reasons.
Perhaps the most common reason is nonpayment of rent. When a tenant signs a lease, they are required to continue paying all rent due under the lease, regardless of whether they live in the property or not. So, if a tenant terminates their lease early, you can deduct all or a portion of their deposit.
Another reason you may be able to make a deduction is to cover excessive property damage. Most leases require tenants to return a rental unit in the same condition they found it at move in, with the exception of normal wear and tear. If a tenant causes excessive property damage, you have a right to deduct a portion of their security deposit.
As a landlord, you may also deduct a tenant’s security deposit to pay unpaid utility bills. When a tenant signs a lease, they become responsible for paying for some utilities. If they move out without clearing them, you may deduct the appropriate amounts from their deposit.
However, you can’t charge your Virginia tenants for cleaning costs.
Do landlords have to provide their tenants receipt of their security?
No, this isn’t required in the state of Virginia. Nonetheless, most landlords still notify their tenants upon receipt of their deposit. In the notice, they also state the amount received as well as where they are storing it.
Are walk-through inspections necessary in the state of Virginia?
Yes. Both landlords and tenants can perform walk-through inspections. Landlords must make reasonable efforts to let their tenants know of the inspections 5 days upon receiving the move-out notice.
In the notice, you must state the date and time of the inspection. The tenant must also respond in writing if they wish to be present during the inspection.
Do Virginia landlords have to maintain records of tenant’s security deposits?
Yes. This is mandatory for landlords in Virginia. Landlords must keep all security deposits records, including any itemized deductions made within the previous two years.
You must also make the deposits available for viewing to the tenant and any of their representatives.
When should landlords return all or a portion of the security deposit back to the tenant?
In the state of Virginia, you must return a tenant’s security deposit within 45 days once a tenant moves out. If you’ve made any deductions to the deposit, you must include an itemized statement of the deductions alongside the remaining portion of the deposit.
Delivery of the notice may be made via certified mail or through hand-delivery.
If the tenant left no forwarding address, you must only keep the deposit for a year. After that, it becomes unclaimed property and you must take it to the State Treasury.
What happens if a landlord fails to return the deposit to the tenant?
Failure to return all or a portion of the tenant’s deposit within the stipulated time may attract some penalties. Some penalties include forfeiting the right to withhold any amount and/or meeting the costs of attorney fees and the lawsuit.
What happens when the property changes hands during an active tenancy?
In such a case, there are two options to consider:
1. Return part or all of the deposit back to the tenant.
2. Transfer all or part of the deposit to the new landlord.
Regardless of which option you choose, you must notify the tenant.
If you choose the second option, in the notice, you must state the amount transferred, as well as the name and address of the incoming landlord. Once that’s done, the security deposit becomes the responsibility of the incoming landlord.
Can a tenant use the security deposit as last month’s rent?
Generally, most landlords are against this. That said, it may be possible, especially if both parties agree to it in writing.
If you have any further questions, or need more assistance, please consider hiring professional help. Lonnie Bush Property Management can help you in all aspects of property management. We can fill your vacancies, collect rent, maintain your property, handle your property’s legal aspects and so much more. We can take away all your management stress.
Disclaimer: This blog is only informational and should not be referenced as a substitute for professional legal advice. Laws continuously change and the information herein may not be updated at the time of your reading.