Security Deposits in New Jersey: Rules Landlords Must Follow

Security Deposits in New Jersey

New Jersey's Security Deposit Law (N.J.S.A. 46:8-19 et seq.) imposes specific obligations on landlords. Failure to comply can result in serious financial consequences.

Maximum Security Deposit

Landlords may not collect more than one and one-half months' rent as a security deposit. This limit applies to all residential tenancies.

Where Security Deposits Must Be Held

Security deposits must be deposited in a separate interest-bearing account at a New Jersey financial institution. The landlord must provide the tenant with written notice within 30 days of receiving the deposit, including the name and address of the bank, the account number, and the interest rate.

Returning the Security Deposit

Within 30 days of the tenant vacating, the landlord must either return the full security deposit plus interest, or provide an itemized written statement of deductions and return the balance. Deductions are only permitted for unpaid rent and damages beyond normal wear and tear.

Penalties for Non-Compliance

A landlord who wrongfully withholds a security deposit may be liable for double the amount wrongfully withheld, plus the tenant's attorney's fees and court costs.

Tenant's Remedies

Tenants can sue in Small Claims Court (for amounts up to $5,000) or Special Civil Part for security deposit disputes. The process is relatively straightforward and many tenants successfully represent themselves.

This article is for general informational purposes only and does not constitute legal advice.