Key Takeaways
- Security Deposit Limits: Landlords in Virginia cannot charge more than two months’ rent for a security deposit, including any pet deposit or insurance fees.
- Move-In Inspection Requirement: Landlords must provide a written move-in inspection report within 5 days of a resident occupying the unit.
- Deductions from Security Deposit: Landlords can deduct from the security deposit for unpaid rent, damages beyond normal wear and tear, and other charges specified in the rental agreement.
- Returning Deposits: Landlords have up to 45 days to return the security deposit after the tenant moves out, with an itemized statement of any deductions.
As a landlord in Virginia, asking residents for a security deposit before moving in is a smart financial move on your part. A resident’s security deposit can help shield you from financial ruin should certain events occur during the tenancy.
An example of such an event is in the case of negligent property damage. The resident may have left the bathtub running, causing flooding and damage to the floor and walls. Another scenario would be failing to repair a leaky faucet or pipe, leading to growth of mold.
In such cases, you’d be able to use part or all of the resident’s deposit to make the required repairs. This would result in zero impact to your bottom line, which is essential in running a profitable rental investment.
Be that as it may, there are certain rules that you must abide by when requiring security deposits from residents. The following article by Peabody Residential is a basic overview of the Virginia security deposit law.
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Maximum Security Deposit Law
Virginia rental laws limit the amount landlords can ask residents as a security deposit. The amount must not exceed the equivalent of two months’ rent. If you’re charging residents a monthly rent of, say, $1,500 per month, then the security deposit must not exceed $3,000.
Alternatively, you could also ask the resident to take a damage insurance cover instead of (or in addition to) the security deposit. The only caveat is that the security deposit plus the insurance cost must not exceed 2X months’ rent.
Additional Pet Deposits in Virginia
No law in Virginia prevents landlords from charging a pet deposit, unless the pet is a service animal. In which case, the disabled resident would qualify for reasonable accommodation under both the state’s Fair Housing Act (FHA) and the Americans with Disability Act (ADA).
The total security deposit amount must, however, not exceed the state’s limit of the equivalent of 2X the monthly rent. It’d also be unlawful of you to try to exceed the limit by using a different label, such as a damage deposit or a pet deposit.
You may still be able to charge the resident a monthly pet rent in addition to the initial security deposit.
Move-In Inspection Report
As a landlord in Virginia, you must provide new residents with a written report describing the unit’s move-in condition. You must do this within 5 days of the resident occupying the unit.
After getting the report, the resident will then have up to 5 days to object to any of the findings in the report. The objections must be in writing and handed to the landlord. The landlord will equally have up to 5 days to object to the resident’s findings.
Alternatively, you and the resident could jointly prepare a written report together and sign the document.
Security Deposit Holdings
Some states require landlords to store their residents’ security deposits in a particular manner. Some require that landlords store them in an interest-bearing account, while others give residents the option of posting surety bonds.
That said, the state of Virginia puts no requirements on landlords. You can store the resident’s deposit in whatever manner you choose, whether that is holding it separately or commingling it with other funds, or storing it in an interest-bearing account. The decision is solely yours to make!
Security Deposit Deductions
As a Virginia landlord, you can make deductions to the resident’s security deposit for any of the following reasons:
- Unpaid rent
- Unpaid utilities
- Damage arising from early lease termination
- Any other charges outlined under the rental agreement
- Cost of damage exceeding normal wear and tear
There isn’t a limit on how much deductions you can make as long as the charges are reasonable. If the resident’s security deposit isn’t able to cover the cost of damage, you have the option to sue.
Normal Wear and Tear vs Damage
Normal wear and tear is the type of damage that occurs to a property over time. It happens due to ordinary, everyday use. And because of that, landlords are responsible for fixing this type of damage.
Examples of damages arising from normal wear and tear include the following:
- Lightly dirtied grout
- Gently worn carpets
- Stained bath fixtures
- Loose door handles
- Faded paint
- Faded wallpaper
- Faded curtains due to sunlight exposure
As for excessive damage, it’s the type of damage that results from a resident’s recklessness or negligence. Due to this, the resident is usually responsible for the cost of repairs.
The following are some examples of damages exceeding normal wear and tear on a rental property:
- A missing or broken tile
- A torn curtain or blind
- A missing door or window
- Large nail holes in walls
- Missing fixtures
- Heavily stained carpets
Sale of Rental Property
After selling a property in Virginia, you’ll have only one option to consider. You can transfer the security deposit to the incoming owner. Once you’ve done this, the new owner would then automatically become responsible for abiding by these security deposit rules.
Final Inspection
Virginia residents have a right to attend a final inspection before moving out of their rented premises. After receiving the resident’s notice of intent to move out, you must notify them of this right. It must be in writing.
If the resident agrees to be present, you must notify them of the date and time of the inspection. You’ll have up to 72 hours to do so after receiving their notice of intent to vacate.
Returning a Resident’s Security Deposit
After a resident moves out of their rental unit, the landlord has up to 45 days to return the deposit. The amount being refunded can either be partial or whole, depending on whether any deductions have been made.
If making deductions, you must send the resident an itemized statement alongside the deposit amount you’re sending.
Conclusion
As a landlord in Virginia, these basics should be at your fingertips for a smooth landlording experience. Violations, either intentional or otherwise, can be costly to your bottom line and reputation.
For expert property management help, look no further than Peabody Residential. We are one of the best property management companies in Northern Virginia. 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.