security deposit interest laws

Security deposit interest laws require landlords to pay tenants interest on the security deposit stored during the tenancy. The rules vary by jurisdiction—some states mandate annual interest payments, specify the interest rate, or set deadlines for interest disbursement when tenants move out. The purpose is to fairly compensate tenants for potential use of their deposit funds. Landlords must adhere to local laws, and failure to do so can lead to penalties or claims for owed interest. It’s important for tenants to understand their rights and review their lease agreements regarding security deposit interest payments.