Security Deposits
What is a security deposit?
NRS 118A.240, 118A.242, and 118A.244, govern security deposits in Nevada. Any amount paid to the landlord to cover any default in payment of rent, the cost of cleaning, or the cost of repairing damages other than ordinary wear and tear is a security deposit. NRS 118A.240. A landlord cannot require a deposit that exceeds 3 months’ rent. NRS 118A.242. A security deposit cannot be nonrefundable, but the landlord can charge a nonrefundable cleaning fee. NRS 118A.242. A security deposit can also be a surety bond. AB 512. During the term of your lease, a landlord cannot require you to pay more for a security deposit. NRS 118A.320.
My landlord is requiring me to purchase a surety bond. Do I have to do this?
No. Although Nevada law allows a surety bond instead of a security deposit, your landlord cannot require the bond and you cannot force the landlord to accept it. However, your landlord can evict you after your lease expires if you do not purchase a surety bond.
If you and the landlord agree, you will pay an up-front fee for a surety bond that will cover the legal deductions normally paid by your security deposit. If you disagree with the charges, you must notify the surety bond company. The surety bond can sue you for damages. We recommend that you should NOT purchase a surety bond.
What can the landlord legally deduct from my security deposit?
NRS 118A.242 allows the landlord to claim from your security deposit any damages, other than ordinary wear and tear, cleaning fees, and unpaid rent. These deductions must be reasonable and lawful. The landlord can also claim any amount owed under your lease, but cannot deduct this amount from your security deposit. The landlord has to return your security deposit within 30 days of your vacating the apartment. If the landlord deducts any amount from your security deposit, the landlord has to provide a written accounting within those 30 days.
What can I do if the landlord does not return my deposit?
If the landlord fails to return your deposit within 30 days and fails to provide a written account, you could sue the landlord for up to 2 times the amount of your security deposit: your original deposit, plus statutory damages in an amount up to your original deposit. In deciding whether to award statutory damages, the judge can consider: (a) Whether the landlord acted in good faith; (b) The course of conduct between the landlord and the tenant; and (c) The degree of harm to the tenant caused by the landlord’s conduct. NRS 118A.242(4). Keep in mind the landlord can countersue you for any amount due under your lease.
I disagree with the landlord’s deductions from my deposit. What can I do?
If the landlord has made any deductions to your security deposit, you have three arguments: (1) the damage did not occur; (2) the deductions were not warranted under the law; and (3) the costs were unreasonable, if warranted.
For example, the landlord deducted the cost to repaint your dwelling based on many chips and scuffs on the walls. You deny this damage and your argument against this charge would be (1): the damage did not occur. If you lived in the dwelling for 10 years, you could also argue that the damage was ordinary wear and tear. Under argument (2), the deduction would not be warranted under the law. If the landlord charged $10,000 to repaint, then you could also argue (3) the costs were unreasonable.
If you want to pursue any claim, we recommended small claims court. It would be up to the judge to decide you claim and what, if anything, the landlord owes you. You should also proceed with caution because your landlord could file a counterclaim.
What happens to my security deposit after foreclosure?
After the foreclosure, sale, or the property otherwise changes hands, your landlord has to either return the security deposit to you, after making any deductions allowed under NRS 118A.242 (explained above), or transfer your deposit (minus the deductions) to the new owner. If the security deposit is transferred, the new owner then has the same obligations as the previous landlord and must return the deposit or provide a written accounting within 30 days after you move out. If the security deposit is not transferred and not returned to you, you can sue the old landlord under NRS 118A.242 if more than 30 days has expired after the property transfers.
The new owner cannot charge you an additional security deposit for 30 days or the duration of your rental agreement, whichever is longer.
If your deposit was transferred, or the new owner charged an additional deposit, the new owner should return your deposit or supply a written accounting within 30 days after you move out. If not, you can sue the new owner. The lawsuit against the new owner would be based on a violation of NRS 118A.242 (see above).
What are some of the rules specifically related to subsidized housing?
Public Housing: In public housing (housing owned and operated by a Public Housing Authority), your landlord (the PHA) can require payment of a deposit that is established in the PHA's policies governing public housing, called the Admissions and Continued Occupancy Policy, but not to exceed one month's rent. Once you vacate a public housing unit, the PHA must refund your deposit to you and/or provide an accounting outlining how the deposit was used similar to the requirements under state law. Any interest accrued may also be refunded. You may also be able to enter into a payment plan for payment of the deposit subject to the rules of the PHA.
If damages are more than your deposit when you move out, the PHA may take any action available under law to collect the deposit. Failing to dispute the amount owed or ignoring the bill may jeopardize your ability to get subsidized housing from any housing authority or government subsidized housing in the future. Any amounts you potentially owe to a housing authority may be grounds to deny any future application for subsidized housing assistance until the amount is paid or it is determined that the amount is not owed.
If you have moved and dispute any charges deducted from your deposit, you will have to file a small claims action to recover your money as discussed above.
HUD/Project Based Properties: If a disagreement arises concerning the reimbursement of the security deposit to the tenant, you have the right to present objections to the owner in an informal meeting. These rules vary depending on the type of subsidized housing so please check the rules regarding your specific housing complex or contact your legal services office for assistance. These procedures do not preclude the tenant from exercising any rights under state and local law.
Section 8 Vouchers: With a Section 8 Housing Choice Voucher, your deposit is paid to the private landlord. Generally, the security deposit will be a part of the lease agreement and is something your landlord can require, subject to approval by the PHA. The PHA will generally not provide payment of the security deposit on behalf of the tenant. Your landlord is required to refund your deposit and provide an accounting when you vacate, but you would generally need to follow state law for the return of your deposit as outlined above. Your landlord can also seek to collect damages over and above the deposit as well.
In the event the PHA does pay your security deposit on your behalf, you would need to reimburse the PHA for the payment. As discussed above, any money owed to the PHA could jeopardize any future applications for subsidized housing.
