Deposit escrow and interest

Your landlord must keep your deposit in a separate bank account in Massachusetts that earns interest. It stays your money, not theirs.

If your landlord holds your deposit for a year or more, they owe you 5 percent interest each year. On a $1,500 deposit that is $75 a year.

Your security deposit is your money, not the landlord's. Chicago law makes the landlord keep it in an insured bank account in Illinois. The landlord cannot mix it with the landlord's own money.

The landlord must hand you a signed receipt when taking your deposit. No receipt means you can demand the whole deposit back right away.

Your written lease must name the bank that holds your deposit. If you have no written lease, the landlord must send you the bank's name and address within 14 days. You earn interest if the landlord holds your deposit more than 6 months. The landlord must pay you that interest within 30 days after each 12 months of renting. Payment can be cash or a credit toward rent. After you move out, the landlord has 45 days to return your deposit plus interest. Mark the date on a calendar.

Under Illinois state law, your landlord must pay you interest if your building or complex has 25 or more units. This applies only if your landlord holds the deposit for more than 6 months. The rate is the passbook savings rate (the rate for a basic savings account). It is set by the largest bank in Illinois on December 31 before your lease began. The state law does not cover buildings with 24 or fewer units or public housing.

Some Illinois cities require interest on more deposits. In Chicago, interest applies unless the building is owner-occupied and has 6 or fewer units. In Urbana, interest must be paid on all deposits over $100 held for more than 6 months.

Your landlord must pay the interest within 30 days after the end of each 12-month rental period. Your landlord can pay cash or give a credit on your rent. This applies once the interest adds up to $5 or more.

If your landlord refuses on purpose to pay the interest, a court can order your landlord to pay you an amount equal to your deposit. The court can add court costs and lawyer's fees.

The landlord does not have to make this yearly interest payment while you are in default under the terms of your lease. When you move out, your landlord must pay all unpaid interest, whatever the amount.

In a Los Angeles home under the Rent Stabilization Ordinance, the landlord owes you yearly interest on a deposit held at least 1 year. If the landlord does not pay the interest, you can sue for it in small claims court.

If your building has 6 or more units, your landlord must put the deposit in an interest-bearing account at a New York bank. Your landlord must tell you in writing the bank's name and address and the amount deposited. Your landlord may keep 1% of the deposit each year as a fee. The rest of the interest is yours. Example: on a $1,000 deposit earning 1.5%, the interest is $15, the landlord keeps $10, and you get $5.

If your building has 6 or more apartments, the landlord must keep your deposit in a New York bank account that earns interest. The landlord can keep 1% of the deposit each year as a fee. 1% of a $1,000 deposit is $10. The rest of the interest belongs to you.

After the deposit has been held for 2 full years, stricter rules start. Deposit money over $100 must be held in an escrow (a separate bank account that holds your money). The landlord must tell you in writing which bank holds the money, the bank address, and the amount.

This rule covers a deposit of more than $100. Once the deposit has been held for more than 2 years, the interest it earns belongs to you. The landlord may keep a yearly fee of 1% of the deposit: 1% of a $1,200 deposit is $12 a year. The landlord must pay you the rest of the interest every year on the date your lease began.

Once your deposit has been held for more than 2 years, stricter rules start if it is over $100. That money must sit in an escrow account (a separate bank account that holds your money for you). Your landlord must tell you in writing which bank holds it, the bank's address, and the amount.

Starting after your deposit's second anniversary, the interest it earns belongs to you. Your landlord may keep a yearly fee of 1% of the deposit. On a $900 deposit, 1% is $9 a year. Your landlord must pay you the rest of the interest every year, on the date your lease began.

Your landlord must put your deposit in a trust account in Washington. This account can be at a bank, credit union, or licensed escrow agent (a company licensed to hold money for other people). This money is not your landlord's to spend. Your landlord must give you a written receipt and tell you in writing the name and address of the account.