Security Deposit Return Laws in New York

Statutes

New York General Obligations Law:

• Section 7-103 (money deposited or advanced for use or rental of real property; waiver void; administration expenses)
• Section 7-105 (landlord failing to turn over deposits made by tenants or licensees and to notify tenants licensees in certain cases)
• Section 7-106 (money deposited or advanced for certain installations; waiver void)
• Section 7-108 (liability of a grantee or assignee for deposits made by tenants upon conveyance of non-rent stabilized dwelling units)

Timeline for the Return of the Security Deposit

New York law states that a landlord is required to return a tenant's security deposit at the termination of tenancy or within a reasonable time after the tenant has surrendered the rental property (returned the keys and left the property) to the landlord.

Because the law doesn't specify an exact number of days, a "reasonable time" is determined by the small claims court judge. Typically, it has usually been ruled to be within the range of 21-45 days.

Mandatory Disclosure to Tenants

When a landlord deposits a tenant's security deposit in a bank or other financial institution, they must notify the tenant of this in writing. The notice must include the following information:

• The name of the financial institution;
• The address of the financial institution; and
• The total amount of money deposited.

What a Landlord Can Withhold

New York allows the landlord to keep the entire security deposit or a portion or it to cover the following:

• The reasonable cost of repairs;
• Damage that exceeds normal wear and tear;
• Unpaid rent; and
• Additional breaches of the lease agreement.