Virginia Security Deposit Laws

Key Takeaways

• Virginia caps security deposits at two months’ rent, so keeping move-in costs clear and well defined sets the right expectations from day one.
• A written move-in inspection report is required within five days and helps everyone stay on the same page about the property’s condition.
• Landlords can deduct only specific items like unpaid rent and damage beyond normal wear and tear, so knowing the difference matters.
• Security deposits must be returned within 45 days after move-out, along with an itemized statement if any deductions are made.

Virginia’s security deposit law is quite straightforward on what landlords must and must not do when collecting security deposits from residents. The law is part of the broader regulations under the Residential Landlord and Tenant Act. 

As a landlord, collecting a security deposit is important in safeguarding your bottom line. You can use it to cover for unpaid rent, utilities, and excessive damage, among other allowable deductions, after the resident has moved out. 

There are some rules you must keep, though. And this isn’t optional; it’s a requirement. Matter of fact, there can be some serious repercussions if you fail to keep them. 

Luckily, you can avoid potential issues simply by familiarizing yourself with your obligations in that regard. And this guide by Keyrenter Solutions has you covered. The following is a basic overview of the Virginia security deposit law. 

Security Deposit Limit 

Virginia law sets a firm cap on what you can collect as a security deposit from a resident. You may not require a security deposit that exceeds two months’ rent, which helps keep move-in costs predictable and reduces disputes at lease signing. 

If you charge additional move-in amounts, be clear about what is a refundable security deposit versus separate, nonrefundable fees (like application or pet fees), since they’re treated differently under the law.

Additional Pet Deposits 

Virginia landlords may also charge a separate pet deposit in addition to the security deposit when a resident keeps a pet, which can help offset pet-related wear and tear or damage risk. This fee should be clearly labeled in the lease and tied to the property’s pet policy so expectations are consistent at move-in and move-out. 

However, landlords must not charge any pet deposit or pet-related fee for residents who have a verified assistance or service animal, including a service animal or emotional support animal. Under the federal Fair Housing Act, landlords must provide reasonable accommodations, which include allowing the assistance animal.

Move-In Inspection Report 

Landlords who collect security deposits from residents are required to provide the resident with a move-in inspection report. In the written report, you must describe the property’s condition to prevent potential conflicts when it comes to security deposit deductions after they move out. 

You have up to 5 days to provide the resident with the written report after they move in. If the resident objects to anything, they must do so in writing. Both of you must then seek a resolution and write the report together after agreeing. 

Security Deposit Holdings

Certain states mandate that landlords retain residents’ security deposits in a specific manner.  For instance, in interest-bearing accounts or apart from other funds.  However, Virginia does not have any of these criteria.

It’s up to landlords to decide the manner in which they want to store their residents’ security deposits. The law also does not require landlords to provide interest on held security deposits.

Sale of Rental Property 

When an occupied rental property is sold in Virginia, the current landlord must transfer each tenant’s security deposit (and any required accounting of it) to the buyer/new landlord.

As the outgoing owner, you should document the exact amounts transferred per unit, the date of transfer, and any deductions already taken or agreed to in writing to avoid disputes later. 

Once the transfer is complete, the new landlord steps into your shoes and becomes responsible for handling the deposit under Virginia’s security deposit rules going forward, including storage, itemized deductions, and returning any remaining balance within the required timeframe.

Security Deposit Deductions 

As a landlord in Virginia, you can make deductions from the residents’ security deposit. However, the following are the only allowable deductions landlords are permitted to make. 

• Unpaid rent.
• Costs of damage exceeding normal wear and tear
• Loss of rent payments due to early lease termination
• Any other charges the lease may outline

When it comes to making deductions from property damage, you must be careful not to get it wrong. That’s why understanding what constitutes normal wear and tear and damage is key. 

Virginia law defines normal wear and tear as deterioration that occurs on a property over time due to normal use. Faded paint, gently worn carpets, soiled bathroom fixtures, and slightly dirty grout are a few examples of this kind of damage.

As for excessive damage, it refers to that which occurs as a result of carelessness on the part of the resident or their guests. Examples include missing fixtures, torn carpets, and broken tiles. 

Security Deposit Returns 

In Virginia, residents have a right to a final inspection. As a landlord, you must notify the resident of this right 5 days before their lease ends. When it comes to returning the security deposit, you’ll have up to 45 days to do so after the resident leaves. 

If you have made any deductions, you must prepare an itemized statement of deductions. You must then send it to the resident’s last known mailing address within 30 days after the resident leaves. 

If you fail to return the deposit within 45 days, you may risk a potential lawsuit from the resident. They can file a claim for the amount of deposit you have wrongfully withheld, plus actual damages, and court and attorney fees. 

Conclusion 

If you collect security deposits, you must follow the state’s security deposit rules. These rules are in place to safeguard both you and the residents’ rights. And please note ignorance of the law isn’t a legal defense.

Keyrenter Solutions is a top-notch choice for property management services in Staunton, Waynesboro, and Augusta County, VA, and its surrounding areas. We can help sort out all your property management worries thanks to our tried and tested solutions. Get in touch to learn more!

Disclaimer: Please note that the information provided in this blog is intended for general guidance and should not be considered as a replacement for professional legal advice. It is important to be aware that laws pertaining to property management may change, rendering this information outdated by the time you read it.