Key Takeaways
Deposit Rules and Limits: State law allows housing providers to charge renters up to two months' periodic rent as security. Renters may also purchase damage insurance instead, provided the combined amount stays within the statutory limit.
Move-In Condition Reports Required: Virginia law generally requires a written condition report within five days after occupancy. The report documents the dwelling unit's condition, and either party may object in writing within the applicable five-day period.
Deductions from Security Funds: Housing providers may withhold money for unpaid rent, authorized late payment fees, documented losses, and damage to the unit beyond ordinary deterioration. Clear records support dispute resolution and explain each deduction.
Virginia security deposit law, included in the Virginia Residential Landlord Tenant Act, requires that landlords who charge security deposits abide by certain rules. Virginia security deposit laws dictate things like:
The highest amount a housing provider may charge a renter under the written contract.
Which deductions an owner may take from the funds because of a renter's actions during occupancy, and how the renter may challenge them.
An owner's duty is to return the renter's full balance, or the remaining portion, after the lease ends or the renter moves out.
What an owner may include in the itemized deduction statement.
Failure to follow these rules can have serious consequences. If a housing provider willfully violates the statute, a court may order the funds returned with actual damages and reasonable attorney fees; when arrears are owed, the court may instead credit the amount against that balance.
To avoid potential issues, keep reading to learn the state's rules and the practical safeguards many landlords use when setting clear expectations.
This way, landlords will know what they can and cannot do regarding tenants' security deposits in Virginia. Keep on reading this blog by KRS Lynchburg to learn more about Virginia security deposit laws.
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A Guide to Virginia Security Deposit Laws
What Is the Maximum Security Deposit Amount a Landlord Can Charge in Virginia?
The Virginia Residential Landlord Tenant Act caps the full security deposit at the equivalent of two months' rent.
For example, if the written contract sets monthly charges at $1,500, the amount collected as security cannot exceed $3,000.
Another option, instead of (or in addition to) a security deposit, is to allow the tenant to purchase damage insurance. Virginia law states that the cost of the tenant's damage insurance and the security deposit must not exceed 2X the monthly rent of the dwelling unit.
A tenant who initially chooses damage insurance may later submit the full security deposit instead, as the statute permits. Both parties should provide documentation of the change.
Can Landlords in Virginia Charge Tenants an Additional Pet Deposit?
Rental owners may charge a pet deposit or recurring pet fee for animals treated as pets. Any amount treated as a security deposit remains subject to the state's overall security deposit limit.
When charging tenants a pet deposit or recurring fee, remember that the total security deposit (move-in deposit and pet deposit) must not exceed twice the monthly housing charge.
Whatever label an owner uses, the total must comply with the state's limit, whether it is called a pet deposit, damage deposit, or another refundable charge.
Housing providers may not charge an additional pet deposit for an assistance animal when fair housing law requires a reasonable accommodation. A consistent accommodation process helps everyone make informed decisions.
Assistance animals are not treated as pets under applicable fair housing requirements, so housing providers should evaluate accommodation requests under the proper legal standard.
Are Move-in Inspection Reports Required in Virginia?
Yes. State law generally requires a written move-in condition report within five days after occupancy. A housing provider may use a permitted policy allowing the renter to prepare the report or allowing both parties to prepare it jointly. These condition reports create a shared record of the unit's condition.
The housing provider must also provide applicable disclosures and a written notice or statement of rights and responsibilities. Those rights include:
A written lease or rental agreement.
Be provided with certain disclosures before moving in, such as the contact info of the owner or property manager.
Be present during the move-out inspection after making the required written request.
Live in a fit and habitable residence as per the Uniform Statewide Building Code.
A just eviction process.
As for the list of responsibilities listed under the Virginia Statement of Tenant Rights and Responsibilities, they include:
Making rental payments on time as stated in the contract.
Allowing the housing provider access to the rental unit at reasonable times and for practical purposes.
Maintaining the rental unit to habitable standards during the tenancy.
Ensure that all carbon monoxide alarms are functioning and that maintenance issues are reported promptly.
Having and paying for renters' insurance if the rental agreement may lawfully require tenants to carry it.
Paying any late payment fee required by the rental agreement.
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Are Landlords in Virginia Required to Store Their Tenants’ Security Deposits in an Interest-Bearing Account?
Some states require security funds to be held in interest-bearing accounts, escrow, or another prescribed arrangement.
The Commonwealth does not generally require residential security deposits to be held in an interest-bearing account. Landlords should still keep accurate records and ensure the funds are available for the required disposition. Advance rental payments have separate escrow-account rules.
Landlords must make sure funds are available within the required timeframe. They must provide written notice and a written list of deductions, then issue any refund due. With prior notice, a reasonable portion may be held to cover unpaid utilities until payment is confirmed.
Keep records, receipts, itemized statements, condition reports, written contracts, and related documents. This documentation supports informed decisions and protects both parties if a dispute develops.
The housing provider must retain deduction records for the statutory period and make them available for inspection during normal business hours. Wrongfully withholding records or funds can create legal consequences.
What Happens to a Tenant’s Security Deposit After a Rental Property Is Sold in Virginia?
When rental property is sold, the current owner must transfer the security deposits and any accrued interest in their possession to the new owner as required by state law.
What Deductions Can a Landlord Make From a Tenant’s Security Deposit?
Here are the rules for accounting for damages and such deductions.
Virginia landlords and rental property owners may use a security deposit to cover specified deductions after move-out, including accrued rent, authorized charges, actual damages, and damage beyond reasonable wear and tear. A careful move-out inspection and condition report help support the written list.
Unpaid Rent: If a renter does not provide the amount owed for the current or prior month, the housing provider may deduct it from the funds to cover the remaining loss of income.
Unpaid Fees: If the tenant moves out without paying due fees, such as late rent fees or unpaid utility bills, the landlord can make the deduction from their security deposit.
Early Contract Termination: If a renter leaves early without legal justification or proper notice, the housing provider may suffer lost rental income. Applicable law may permit the owner to apply some or all of the remaining funds to documented losses when the resident abandons the unit.
Damage Beyond Normal Wear and Tear: These costs may include repairs or necessary carpet cleaning for damage caused by negligence, misuse, or a breach of the rental agreement. Ordinary aging is not the same as damage beyond normal wear.
The following are examples of what commonly constitutes excessive property damage and normal wear and tear
Excessive Rental Property Damage
Marks, graffiti, or unauthorized paint colors.
Excessive damage.
Holes in the wall.
Chipped or gouged wood floors.
A missing hinge.
Misused plumbing fixtures.
Unapproved wallpaper.
A torn curtain or blind.
Appliances broken through misuse rather than ordinary long-term use.
Normal Wear and Tear
Faded paint.
A few nail holes in the wall.
Minor scuffs or gradual wear on flooring.
A squeaky door due to a sticky hinge.
A faded wallpaper.
A faded blind or curtain due to sunlight exposure.
Appliance wear caused by normal long-term use.
When Must Virginia Landlords Return Their Tenants’ Security Deposits in Virginia?
When returning security deposits, the landlord or managing agent generally has 45 days after the tenancy terminates or the tenant vacates and delivers possession, whichever occurs last. The written statement or itemized deduction list and any balance due must be sent within the applicable period. Third-party repair costs may permit the additional statutory period.
Track dates, condition reports, records, receipts, and contracts so both parties share a reliable record and the landlord can return the security deposit correctly.
Bottom Line
This guide outlines the important basics of collection, records, allowable deductions, refunds, and security deposit returns under Virginia law.
For expert help in staying legally compliant or overall management of your Lynchburg property, look no further than KRS Lynchburg. You can count on us for optimal return on investment and peace of mind.
And if you're looking to learn more about the lease or rental agreement, or legal responsibilities of landlords in Virginia, read our blog post on Virginia landlord-tenant law. These rules are constantly evolving, and it's best to stay updated on Virginia's landlord-tenant laws to stay legally compliant. Stay up to date!
For help with returning security deposits or other questions, comments, or concerns, contact KRS Lynchburg today.
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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.
