General information, not legal advice. Landlord-tenant rules change, and cities and counties can add their own. Check the current statute and local ordinances, and talk to a licensed attorney before you act.
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The short version
- A security deposit cannot exceed one and a half months of rent, and any later yearly increase is limited to 10 percent of the current deposit.
- The landlord must return the deposit with interest, less lawful deductions, within 30 days after the tenancy ends, or within five business days when a fire, flood, condemnation or evacuation displaces the tenant.
- Any deductions must be listed in an itemized statement sent with the balance by personal delivery or registered or certified mail.
- Interest earned belongs to the tenant and is paid in cash or credited toward rent each year on the lease anniversary or renewal, or on January 31 if the tenant was told in writing.
- A tenant whose deposit is wrongfully withheld can sue for double the amount withheld, plus court costs and reasonable attorney fees.
New Jersey's Security Deposit Act limits deposits to one and a half months of rent, requires the money to sit in an interest bearing account at a New Jersey institution and gives the landlord 30 days after the tenancy ends to return it with an itemized list.
New Jersey security deposits at a glance
| Rule | New Jersey | Law |
|---|---|---|
| Deposit limit | A security deposit cannot exceed one and a half months of rent, and any later yearly increase is limited to 10 percent of the current deposit. | N.J.S.A. 46:8-21.2 |
| Deadline to return the deposit | The landlord must return the deposit with interest, less lawful deductions, within 30 days after the tenancy ends, or within five business days when a fire, flood, condemnation or evacuation displaces the tenant. | N.J.S.A. 46:8-21.1 |
| Itemized deductions | Any deductions must be listed in an itemized statement sent with the balance by personal delivery or registered or certified mail. | N.J.S.A. 46:8-21.1 |
| Interest on deposits | Interest earned belongs to the tenant and is paid in cash or credited toward rent each year on the lease anniversary or renewal, or on January 31 if the tenant was told in writing. | N.J.S.A. 46:8-19 |
| Penalty for wrongful withholding | A tenant whose deposit is wrongfully withheld can sue for double the amount withheld, plus court costs and reasonable attorney fees. | N.J.S.A. 46:8-21.1 |
How much you can collect
Deposit limit. A security deposit cannot exceed one and a half months of rent, and any later yearly increase is limited to 10 percent of the current deposit. (N.J.S.A. 46:8-21.2)
Holding the deposit
Where the deposit is held. Deposits are held in trust in an interest bearing account at an insured bank or savings institution in New Jersey, or for larger landlords an eligible New Jersey money market fund, and never mixed with the landlord's own money. (N.J.S.A. 46:8-19)
Interest on deposits. Interest earned belongs to the tenant and is paid in cash or credited toward rent each year on the lease anniversary or renewal, or on January 31 if the tenant was told in writing. (N.J.S.A. 46:8-19)
Receipts and notices. Within 30 days of receiving the deposit, and at each annual interest payment, the landlord must tell the tenant in writing the name and address of the institution, the type of account, the interest rate and the amount; if not, the tenant may apply the deposit to rent. (N.J.S.A. 46:8-19)
Deductions and normal wear and tear
A deposit can cover unpaid rent and damage beyond normal wear and tear. Everyday aging, such as faded paint, small nail holes or light carpet wear, is not damage.
Itemized deductions. Any deductions must be listed in an itemized statement sent with the balance by personal delivery or registered or certified mail. (N.J.S.A. 46:8-21.1)
Returning the deposit
Deadline to return the deposit. The landlord must return the deposit with interest, less lawful deductions, within 30 days after the tenancy ends, or within five business days when a fire, flood, condemnation or evacuation displaces the tenant. (N.J.S.A. 46:8-21.1)
Penalties for wrongful withholding
Penalty for wrongful withholding. A tenant whose deposit is wrongfully withheld can sue for double the amount withheld, plus court costs and reasonable attorney fees. (N.J.S.A. 46:8-21.1)
Mistakes to avoid
- Skipping a dated move-in condition report with photos, then having nothing to compare against at move out.
- Charging for normal wear and tear.
- Missing the return deadline, even by a few days.
- Not asking for a forwarding address before the tenant leaves.
- Losing track of deposit money by mixing it with operating funds without a ledger.
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General information, not legal advice.
Verify current law
We last checked these New Jersey rules on . Laws change and cities can add their own, so confirm the current text before you rely on it, and talk to a New Jersey attorney about your situation.
Laws named on this page
- N.J.S.A. 46:8-21.2
- N.J.S.A. 46:8-21.1
- N.J.S.A. 46:8-19
Official sources
New Jersey forms for this topic
Letters and checklists for this topic
Where landlords trip up.
Is there a limit on security deposits in New Jersey?
A security deposit cannot exceed one and a half months of rent, and any later yearly increase is limited to 10 percent of the current deposit. Source: N.J.S.A. 46:8-21.2.
How long does a New Jersey landlord have to return a deposit?
The landlord must return the deposit with interest, less lawful deductions, within 30 days after the tenancy ends, or within five business days when a fire, flood, condemnation or evacuation displaces the tenant. Source: N.J.S.A. 46:8-21.1.
Do New Jersey landlords have to pay interest on deposits?
Interest earned belongs to the tenant and is paid in cash or credited toward rent each year on the lease anniversary or renewal, or on January 31 if the tenant was told in writing. Source: N.J.S.A. 46:8-19.
What happens if a New Jersey landlord keeps a deposit wrongly?
A tenant whose deposit is wrongfully withheld can sue for double the amount withheld, plus court costs and reasonable attorney fees. Source: N.J.S.A. 46:8-21.1.