How Does the Return of a Security Deposit Work in New Jersey?
February 28, 2025
Authored by: Jeff Stephens
This article is made possible by the generous support from Taylor Tufano at 9Sail.
Jeff Stephens
If you are, or have ever been, a renter, then you have likely had to pay a security deposit as part of your lease. You may also have had a landlord refuse to return all or part of your deposit. Many renters in New Jersey are not aware that New Jersey law dictates what happens at the end of the lease term and what your landlord’s obligations are regarding the return of the security deposit. This article is meant to provide a brief overview of the landlord’s obligations after the tenant has vacated and the tenant’s recourse when a landlord withholds a security deposit.
Understanding New Jersey Security Deposit Laws
The law governing security deposits in New Jersey is N.J.S.A. 46:8-19 through 26. Under the Security Deposit Law, the maximum amount a landlord can receive as a security deposit is one- and one-half times (1½ x) the monthly rental payment. So, if your monthly rent is $2000, then the security deposit cannot be more than $3500. Landlords must deposit your security deposit into an interest-bearing account, and the earnings or interest belong to the tenant and must be added to the amount of the security deposit returned when the tenant moves out.
Timeline for Returning a Security Deposit in New Jersey
New Jersey’s Security Deposit Law requires that within 30 days of the tenant moving out, the landlord must return the security deposit and interest, less any rent owed or charges for repairing damage to the property that is beyond ordinary wear and tear. If the landlord is claiming any deductions, they must send the tenant, by registered or certified mail, an itemized list of the deductions within 30 days of the tenant moving out.
Security Deposit Deductions
A landlord does have the right to make deductions from the security deposit.
-Unpaid Rent: A landlord can deduct for unpaid rent. So, if there are any unpaid months of rent on the lease at the time the tenant vacates the unit, the landlord can then deduct these months from the security deposit. It’s important to keep this in mind when considering whether to take legal action against a landlord, because a former landlord may have been willing to forego unpaid rent, but then after a former tenant files a complaint for the return of the security deposit, the former landlord might make a counter claim for unpaid rent and the tenant could end up with a judgment against them.
-Damages, beyond ordinary wear and tear: A landlord can also deduct costs for damages that are beyond ordinary wear and tear. The question of whether damages are “ordinary wear and tear” is a fact-specific analysis, but generally speaking, if the damages are the result of regular and common use of the unit, then these should not be deducted from security deposits. A tenant would not be required to repaint a unit’s walls or to fill ordinary nail holes caused by wall hangings. However, if the tenant leaves the unit with large holes in the walls or has painted a wall a bold or bright color when the original unit was all white, then the landlord would likely be able to claim these damages are not ordinary wear and tear.
Steps a Landlord Must Take:
If the landlord is deducting any amount from the security deposit for damage or for unpaid rent, the landlord must send the tenant, by registered or certified mail, an itemized list of the alleged rent due, damage claimed, and the cost of the repairs. Per N.J.S.A. 46:8-21.1.
If more than 30 days have passed since a tenant vacated the premises, and the landlord has not returned the deposit or provided an itemized list of deductions, or if a tenant wants to object to the amounts being withheld, then the tenant may have recourse to take legal action seeking the return of the withheld security deposit.
A tenant in the above situation can assert the rights under the Security Deposit Law, but tenants in owner-occupied buildings with only two rental units must first make a written demand to the former landlord demanding the return of the withheld deposit.
Tips for Tenants to Maximize the Return of Their Security Deposit
If a tenant objects to deductions or if a landlord refuses to provide an itemization of deductions, a tenant can file a civil court action for double the amount of the withheld security deposit. Under the Security Deposit Law (N.J.S.A. 46:8-21.1), tenants can recover double the security deposit, plus court costs, attorneys fees, and interest.
It is always good practice to retain copies of security deposit checks, receipts, bank records showing security deposit payment, your lease, and any communications from the landlord regarding payment. It is also good practice to ask the landlord to inspect the unit with you immediately after you vacate and obtain confirmation (ideally written) that there are no damages. Additionally, take plenty of photos/videos of your unit before you officially move out.
You won’t have to file provide these documents when you file the complaint, but you should have them ready for the court when the case is scheduled for trial. Even if you don’t have these records, you can always provide testimony at trial to support your case and you can make demands from the landlord to produce documentation regarding the security deposit after you filed the complaint.
Where to File the Complaint:
Keeping in mind that you would be seeking double the amount of the withheld amount, if that amount does not exceed $5,000, including any applicable penalties, but not including costs, then the complaint would be filed in the Small Claims section of the Superior Court in the county where the rental property is located, or in the county where the landlord resides. If the amount exceeds $5,000, but is less than $10,000, you would file in the Special Civil Part of the Superior Court.
How Volunteer Lawyers for Justice Can Help You
At Volunteer Lawyers for Justice (VLJ), we help tenants prepare demand letters for the return of their security deposit, as well as help prepare pro se complaints for tenants to file against landlords who have unlawfully withheld security deposits.
