Can landlords charge non-refundable security deposits?

Understanding Security Deposits in Maine: Can Landlords Charge Non-Refundable Security Deposits?

If you are a tenant in Maine, it is essential to understand your rights and responsibilities concerning security deposits. A common question tenants have is whether landlords in Maine can charge non-refundable security deposits. Below, you will find a detailed explanation of Maine landlord-tenant laws related to security deposits, including what is allowed, what is not, and best practices tenants should be aware of.

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What is a Security Deposit?

A security deposit is a sum of money a landlord collects from a tenant prior to moving into a rental unit. Its purpose is to protect the landlord against potential damages, unpaid rent, or other lease violations. Typically, the deposit is refundable at the end of the tenancy, minus any deductions for legitimate reasons as outlined by the landlord-tenant lease agreement and Maine law.

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Maine Law on Security Deposits

In Maine, security deposits are specifically regulated under Title 14, Chapter 709 of the Maine Revised Statutes. According to these regulations:

• Security deposits must be refundable.
• Landlords cannot designate a portion or the entirety of the security deposit as "non-refundable" in the lease agreement.

This means that any money collected as a security deposit must be refundable to the tenant, minus deductions that the landlord can lawfully make for unpaid rent, damages beyond normal wear and tear, or other violations as permitted by the lease.

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Can Landlords Charge Non-Refundable Security Deposits in Maine?

No, landlords in Maine cannot charge non-refundable security deposits.

The statutes require that security deposits always be refundable. If a landlord attempts to label any portion of the deposit as “non-refundable,” that part is effectively treated as rent. For example, fees for cleaning or pet deposits that are termed as "non-refundable" must be explicitly outlined as separate fees or charges and not lumped into the security deposit.

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What About “Non-Refundable Fees” that Landlords Charge?

While the security deposit must be refundable under Maine law, landlords may charge certain fees that are non-refundable, as long as they are separate from the security deposit. These may include:

• Application fees (to process tenant applications)
• Administrative or screening fees
• Pet fees that are explicitly stated as separate from the security deposit

However, these fees must be clearly itemized and are not legally considered part of the security deposit. It is important that these fees are reasonable and disclosed upfront.

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Maximum Security Deposit Amount

According to Maine statute:

• A landlord may not demand a security deposit exceeding two months’ rent.
• Upon tenancy termination and vacating the property, the landlord must return the deposit within 30 days, accounting for any lawful deductions.

Tenants should ensure that the lease agreement states the deposit amount and how it will be handled.

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Tenant Protections Around Security Deposits

Maine law offers several protections for tenants regarding security deposits:

• Itemized Deductions: If the landlord deducts from the security deposit, they must provide an itemized list of damages or charges along with the remaining balance.
• Return Timeline: The deposit or the balance minus deductions must be returned within 30 days after the tenant has vacated.
• Interest Payment: In Maine, if the security deposit is held for 6 months or more, the landlord must pay interest on the deposit. The interest rate is set annually based on state statutes.

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Practical Advice for Tenants in Maine

• Read Your Lease Carefully: Never sign a lease that calls for a non-refundable security deposit. If you see language labeling all or part of your security deposit as non-refundable, discuss or negotiate this before signing.
• Request Documentation: When you pay your security deposit, get a receipt and keep copies of the lease and any communication about fees.
• Inspect the Property on Move-In and Move-Out: Conduct a walk-through with the landlord to document the property condition. Photographs and written notes can help if there is a dispute over damage deductions.
• Know Your Rights About Refunds: If your landlord keeps your entire security deposit without justification and fails to provide an itemized list of damages, you have the right to contest this retention under Maine law.
• Ask About Separate Fees: If you are charged a pet fee or cleaning fee, make sure these are clearly identified as separate from your security deposit.

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Summary

• Maine law requires security deposits to be refundable; non-refundable security deposits are not permitted.
• Landlords can charge non-refundable fees such as application or pet fees if clearly separated from the security deposit.
• The maximum security deposit is limited to two months' rent.
• Landlords must return the refundable security deposit within 30 days after tenancy ends, along with an itemized list of any deductions.
• Tenants are entitled to interest on security deposits held for six months or longer.

Understanding these rules empowers tenants to protect their rights and avoid unfair charges. If you believe your landlord is improperly holding your deposit or charging a non-refundable security deposit, you may want to seek advice from a local tenant advocacy organization or legal professional familiar with Maine landlord-tenant law.

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By staying informed about Maine’s regulations on security deposits, tenants can enter rental agreements with greater confidence and safeguard their financial interests throughout their tenancy.