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A security deposit is money you give your landlord when you move in that must be given back at the end of the lease, unless your landlord has a good reason to keep it. Possible good reasons to keep it are:
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You haven’t paid all your rent;
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You haven’t paid all your utilities and your landlord has to pay them so the next tenant can have utilities, too; or
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You’re leaving the home damaged beyond normal wear and tear.
Deposit or Fee?
Any money you give your landlord that is refundable is a part of the security deposit, no matter what your landlord calls it. If it’s not refundable, it’s a fee. To determine whether it’s a fee or part of the deposit, read your lease to see if money you’re paying to move in will be given back when your lease ends. Fees are not included in the total amount of the security deposit.
For example: if you pay money that you’ll be given back if your dog Fido doesn’t do any damage, it’s part of the deposit. If you pay money that the landlord gets to keep no matter how perfectly Fido behaves, it’s a fee.
If you’re told you have to pay your last month’s rent to move in, that’s part of the security deposit. Your deposit can only be up to one and a half times your monthly rent. For example, if your rent is $500 a month, your security deposit can't be more than $750. If your landlord wants more than one and a half times your monthly rent as a security deposit, you can inform your landlord that you know the security deposit can only be one and a half (1½) times the monthly rent. Keep communications about this in writing. Your landlord cannot deny you housing if you enforce your rights.
It Applies to Your Home
Michigan’s Security Deposit Law applies to agreements for rental units. A rental unit is a structure used as a home by a single person or family. It includes apartments, boarding houses, rooming houses, mobile home spaces, and single and two-family dwellings. If you’re renting your home, the security deposit law applies.
A lease, also called a rental agreement, is an agreement that creates or changes the terms, conditions, or any other provisions about the use and occupancy of a rental unit.
Before You Sign
Ask how much the security deposit is when looking for a new home to rent. Don’t wait until you’re signing a lease or moving in to find out.
If you’re going to pay a security deposit, your landlord must notify you in writing no more than 14 days after your lease starts or you move in. The notice must give you the landlord’s name and address where you should send any communications. The notice must also tell you the name and address of the bank or credit union where your deposit will be held. The notice is usually part of the lease.
This notice must be in 12 point bold font or at least four font sizes bigger than the rest of the lease. For example, if the document is in 12 point font size, the notice should be in 16 point font. It must say:
You must notify your landlord in writing within four (4) days after you move of a forwarding address where you can be reached and where you will receive mail; otherwise your landlord shall be relieved of sending you an itemized list of damages and the penalties adherent to that failure.
If you pay a security deposit, you can ask your landlord for a receipt to avoid a future dispute about how much was paid.
Your Move-In Checklist
The move-in checklist is an important part of the security deposit process. Your landlord should give you two copies of an inventory or move-in checklist. The first page should say in boldface 12 point type:
You should complete this checklist, noting the condition of the rental property, and return it to the landlord within 7 days after obtaining possession of the rental unit. You are also entitled to request and receive a copy of the last termination inventory checklist which shows what claims were chargeable to the last prior tenants.
If your landlord doesn’t give you a checklist, you can ask for one. If the landlord refuses to give you one, you can do your own inspection of your home, noting any problems.
Go through your home, room by room, and make a note of anything that is damaged. This includes little things, like chips in the paint or cracks in a window. Sign and date the checklist. Make a copy of the checklist. Give one copy to your landlord. Keep one copy for yourself. Take pictures or video of any damage you find.
If you don’t return the completed move-in checklist, you’re agreeing that everything about the home is in good condition when you move in. It’s important to report all problems to your landlord at the beginning of your lease so that it’s clear that you didn’t cause them. It’s possible your landlord will fix any problems you report on the checklist. If so, note the repairs on your copy of the checklist.
Do not sign a move-in checklist if you don’t agree with it. If you do, you might end up having to pay to fix damage that was there when you moved in.
Your Move-Out Checklist
When you move out of your home, use the checklist again to record the condition of it. You may not have to give a copy of this to your landlord, but keep a copy for your records.
Check out with the landlord if you can. If your landlord does not make a report, you can make your own report and ask your landlord to sign and date it. If your landlord does not sign it, you can have another person sign and date your report after looking over the property.
If you think you may disagree with the landlord about how you left the property, you can ask another person to inspect the property. You can also take pictures of the conditions at the time you move out.
Getting Your Security Deposit Back
Unless your landlord has a reason to keep it, you should get your security deposit back after you move out. Some reasons your landlord can keep your security deposit are:
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You haven’t paid all your rent;
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You haven’t paid all your utilities and your landlord has to pay them so the next tenant can have utilities, too; or
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You’re leaving the home damaged beyond normal wear and tear.
The process of getting your security deposit back starts when you move out. When moving out, be sure to return your keys and remove all personal items.
Provide Your Forwarding Address in Writing
Within four days of moving out of your old home, you must give your landlord your new address in writing. You can give your landlord your new address before you move out.
Your landlord then has 30 days to either return your deposit or send you a list of the damages and the remaining balance of the deposit. If you get an itemized list of damages, you have seven days to respond. Your landlord has 45 days from when you move out to start a court case for damages.
If you don’t provide your new address, your landlord does not have to give you an itemized list of damages. Your landlord can keep your security deposit until you do something to get it back.
If you don’t want to give your landlord your new address, you can provide a different forwarding address like a P.O. Box. If you do this, make sure you regularly pick up any mail sent to that address so you can respond to the list of damages within seven days.
The List of Damages
The list of damages should be itemized and include the estimated cost of repairs or copies of receipts for the actual cost of repairs for each damaged item. Damages on this list may include unpaid rent.
It should also contain a notice: “You must respond to this notice by mail within 7 days after receipt of same. Otherwise you will forfeit the amount claimed for damages.”
Objecting to the List of Damages
If you get an itemized list of damages and you don’t agree with it, you have seven days to mail a response to your landlord. You must respond in detail. Address every point of disagreement. If you don’t specifically object to an item, then you’ve agreed to it. Keep a copy of your response for your records.
For example, you get a list of damages from your landlord that says you left a broken tile in the bathroom and it will cost $45 to repair it. You know that tile was broken when you moved in. If you properly filled out your move-in checklist, you have a record of that damage. You should also be able to ask for and get a copy of the previous tenant’s move out checklist, which could show the tile was damaged before you moved in. Respond within seven days, and remind your landlord that the tile was broken when you moved in and you aren’t responsible for that damage. If you kept a copy of your move-in checklist, you may want to show it to your landlord, but don’t give away your only copy. Always keep a copy for your records.
If you do not respond to your landlord’s notice of damages within seven days of receiving it, you have agreed to the statement of the damages.
If you and your landlord can’t agree about the damages or cost, your landlord has 45 days after you move out to file a suit and a judge will decide the amount that is owed.
Normal Wear and Tear
Damage is harm to the home beyond normal, everyday wear and tear. Things like furniture, appliances, carpets, and flooring can wear out from just being used. Walls need to be painted from time to time. Those are reasonable since you’ve been living in the home.
Some dirtiness is normal everyday wear and tear, so your landlord can’t charge you for the costs of cleaning from your security deposit. But your landlord could charge you a cleaning fee at the beginning of your lease, to cover the cost of cleaning when you leave. If you leave the home really dirty, it might be considered damage. For example, if you leave trash everywhere, or pet feces around, you will probably have to pay the cost of having that cleaned.
Some examples of damage you'll have to pay for are a broken window, a burn mark where you set a hot pan on the counter, or a broken drawer in the kitchen.
30 Days and Then?
If you give your landlord your new address but don’t get your deposit back or a list of damages within 30 days of your move out date, your landlord can’t claim any damages against your security deposit. You might still be responsible for the cost of damages or unpaid rent, but your landlord can’t use your security deposit to get that money. You might be entitled to double your security deposit back.
45 Days or Double
Your landlord has 45 days from when you move out to start a court case for damages. If all of the following happen, you can sue your former landlord for double your security deposit (for example, if your security deposit was $1,500, you can sue for $3,000):
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Your landlord doesn’t start a court case in 45 days or return your deposit to you
- You provided your forwarding address within four days of moving out
- You responded to the notice of damages seven days or less after getting it (or didn’t get it at all)
If more than 30 days go by and your landlord has not returned your security deposit or given you a list of damages, you can use the Do-It-Yourself Letter to Landlord (Security Deposit) tool. This tool makes a letter that you can send to your landlord. The letter tells your landlord what they have to do under the law. It also says that you might file a lawsuit to get your money if they do not follow the law.
Owing More Than Your Security Deposit
You could be responsible for the cost of repairing damages over the amount of your security deposit.
For example, your security deposit was $750 and you owe damages that total $1,000. Your landlord sends you an itemized list of the damages you owe. Not only can your landlord keep the $750 deposit, your landlord could also demand the additional $250. If your landlord files a court case to get that money, you may also be responsible for the costs of filing the court case.
Going to Court to Get Your Deposit Back
If your landlord does not return your security deposit, you can sue. If your landlord owes you $7,000 or less, you can sue in small claims court. This is a special division of the district court where people cannot have lawyers or a trial by jury.
If your landlord owes you more than $7,000, you can still sue in small claims court but you won’t be able to receive anything more than $7,000. To learn more about small claims court, read An Overview of Small Claims Court. You can also use our Do-It-Yourself Small Claims Suit tool to prepare your forms.
If your landlord objects to having the case heard in small claims court, the case will be transferred to the general district court.
If your landlord owes you more than $7,000, you can file a general civil case in district court. Suing in the trial court division may be more complicated than suing in small claims court. You may want to talk to a lawyer before you do this. If you need a lawyer and have low income, you may qualify for free legal help. Whether you have low income or not, you can use the Guide to Legal Help to find lawyers and a legal services office in your area.
What to Expect in Court
If the case goes to court, each side has a chance to tell his or her side of the story.
If either party wants a jury trial, it must make a written request within 28 days after the filing of the answer or a timely reply. If either side wants a jury trial in small claims court, the case must also be removed to general court because jury trials aren’t allowed in small claims court.
Whoever started the suit is the Plaintiff. The Plaintiff gets to speak first, and will be asked to show the court any evidence to prove the case and to call witnesses to testify about it.
After the Plaintiff is done, the person being sued, the Defendant, will be asked to show the court evidence and call witnesses.
After each side has its turn, the judge or the jury will decide the amount that is owed.
The person who wins the case can ask the court to order the other person to pay some of the costs for the case. The amount of costs is set by the law. To learn more watch our Going to Court video.