What you need to know about the security deposit

We at the Rent Support Center regularly receive questions about the security deposit. Therefore, in this article we list the most important issues. So read on if you have questions about, for example, a withheld deposit.
Photo: Cottonbro.
Photo: Cottonbro.
Photo: Cottonbro.
Photo: Cottonbro.

THE GOOD LANDLORD ACT

In early July 2023, the Good Landlord Act came into effect. With this, the legislator intended to flesh out the concept of “good landlordship. For example, it is now mandatory for the landlord to put the lease in writing.

This also immediately establishes a legal regulation on the rent deposit. This, in fact, was not the case before then, oddly enough. In this article, we explain the most important issues regarding the security deposit.

THE DEPOSIT

It is good practice for a landlord and tenant to agree that the tenant will pay a certain amount as a deposit at the start of the rental period. This deposit serves as security for the landlord, should there be any outstanding claims after the end of the rental period which the tenant has not paid to the landlord. The deposit serves as a reminder that the tenant takes responsibility for the property. The landlord can still obtain the money he is owed by using the deposit.

Unfortunately, in practice, however, discussions often arise as to whether the landlord is entitled to withhold the deposit (in part or not). As mentioned, the Good Landlord Act has clarified this. Indeed, it has established a number of legal rules regarding the security deposit. A number of rules are taken directly from established case law. We list the most important issues.

THE DEPOSIT AND THE LEGAL RULES

Level of the deposit: the landlord may charge a maximum deposit of twice the bare rent. The bare rent is the rent excluding service charges and other additional costs. For example, if the lease states that the bare rent is 500 euros, the deposit may not exceed 1000 euros.Note: this cap applies only to leases concluded after the Good Landlord Act comes into force, i.e. after July 7, 2023.

Withholding the deposit: the landlord may legally, only withhold the deposit when there is overdue rent, overdue service charges and in case of damage.

Return of deposit: the landlord is now obliged to return the deposit within 14 days when there is no reason to withhold the deposit. Therefore, if you as a tenant have always paid the rent and service charges neatly, and have crudely said nothing else, then the landlord must simply return the security deposit. Unless there is overdue rent, service charges, energy performance fee and/or damage to the leased property that is the tenant’s responsibility.

In that case, a repayment period of thirty days applies. If the landlord deducts costs from the security deposit, the tenant must be informed of this in writing and receive a full cost breakdown.

TIPS:

You may be able to agree with your landlord that the security deposit will be “parked” in an account of an independent third party for the duration of your lease. This means that at the end of the lease, the landlord cannot access the deposit himself. The security deposit cannot then also simply be retained by your landlord.
Always take as many photos and/or visual material as possible when you move into the rented property. This way, when you leave, you can always prove that the furniture was not in a very good condition when you moved in. Conversely, when you leave, document with the landlord what the condition of the rented property is, so that you cannot be held responsible afterwards for things you are not responsible for.
Always put agreements about the deposit in writing together with your landlord.
Whatever happens, always pay your rent properly. Even if, for example, you have all kinds of defects in or on your rented property. Then in principle there is no reason for the landlord to withhold the deposit. And you will have nothing to reproach yourself with, should it come to legal proceedings with your landlord.

THE DEPOSIT, THE RULES AND PRACTICE

Of course, it is good that the legislator has laid down these rules in the Good Landlord Act, but unfortunately, of course, this does not prevent the discussions that already existed before the Good Landlord Act went into effect. After all, what if you have doubts about the service charge statement? After all, according to the letter of the law, the landlord may now also offset these costs against the security deposit if they have not been paid. Or what if the landlord claims that furniture has been damaged and decides to withhold the deposit, when you are sure that it was already there?

Should you find yourself in such a situation, feel free to contact us to discuss it. E-mail, call or just drop in; it’s fine with us. After all, we are happy to help you. Coffee is ready and waiting.

 

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