For property owners or their agents (“Landlords”), security deposits are a safety net that helps protect against potential financial losses due to residents’ unpaid rent or damage to the property. In Rhode Island, landlords are allowed to collect a security deposit prior to a tenant taking possession of a unit.
Landlords may not use a security deposit to cover normal wear and tear, but they can use it to cover outstanding rent or damage caused by a resident’s neglect, abuse, or lease violations. Keep reading to learn more about this facet of Rhode Island landlord-tenant law.
Guide to Rhode Island Security Deposit Law
1. Rhode Island Security Deposit Limit
Most states limit how much security deposit a landlord can collect. In Rhode Island, landlords are allowed to collect a security deposit not to exceed to one month’s rent.
2. Nonrefundable Fees
The security deposit must be refundable when the resident moves out. Should the landlord charge other non-refundable fees (i.e. non-refundable pet fees), the lease should clearly identify these fees as non-refundable.
3. Storing a Tenant’s Deposit in Rhode Island
Rhode Island law does not require landlords to disclose where the security deposit is held or earned on security deposits.
4. Written Notice after Security Deposit Receipt
Some states mandate landlords to provide a written notice after receiving the security deposit from residents. Rhode Island does not require a landlord to provide tenant information identifying where a security deposit is held or any income earned on that security deposit.
5. Reasons to Withhold a Tenant’s Security Deposit in Rhode Island
The purpose of the security deposit is to protect landlords from financial losses in case residents fail to pay for property-related obligations. In Rhode Island, landlords are allowed to make deductions from the security deposit for the following reasons:
- Cover unpaid rent: Non-payment of rent is one of the most common reasons for disputes between landlords and residents. It is also one of the reasons that cause financial losses. Security deposits can be used to cover any unpaid rent.
- Pay for the cost of trash disposal: In Rhode Island, landlords can charge residents for the cost of trash disposal. If residents fail to pay such fees, landlords are entitled to deduct the fees from the security deposit.
- Pay for cleaning fees: In Rhode Island, landlords can charge residents for cleaning services as long as the amount is reasonable and is not for normal wear and tear. Landlords also have the option to deduct the cleaning fees from the security deposit.
- Cover cost of excessive damage beyond normal wear and tear: Landlords are required to repair normal wear and tear without charging the resident for it. However, if the damage was due to residents’ neglect, abuse, or lease violations, the landlord can deduct the cost of damage from the security deposit.
Rhode Island law does not limit landlords on how much they can charge for the cost of damages, as long as the amount is deemed reasonable. However, landlords are not allowed to charge residents for damages that are part of normal wear and tear.
Other deductions that landlords may charge from the security deposit include:
- Carpet replacement: Rhode Island landlords can charge residents for carpet replacement if the damage is not part of normal wear and tear.
- Nail holes: If residents damage the walls due to nail holes, landlords may charge the cost of repair and deduct the amount from the security deposit.
- Unauthorized painting: If residents repainted the wall without permission from the landlord, or if the painting is done unprofessionally, the cost of repainting may be deducted from the security deposit. If there is damage to the paint that is not part of normal wear and tear, the cost can also be deducted from the security deposit.
6. Walk-Through Inspections
There is no statute under Rhode Island law that requires landlords to perform a walk-through inspection and invite residents to be present. Although, this is a recommended practice that protects landlords from future claims regarding the move-in/move-out condition of the property.
7. Security Deposit Refund in Rhode Island
In Rhode Island, landlords are required to return the security deposit (or any unused portion of the deposit) by mail with a written notice to the former resident’s forwarding address within 20 days after the following required conditions have been met:
- When the resident delivers possession of the property to the landlord.
- After the resident informs the landlord of their new forwarding address.
If a Rhode Island landlord fails to return the remaining security deposit or wrongfully withholds rent from residents, they may be liable and pay three times the monthly rent, attorney’s fees plus a court-mandated penalty.
8. Change in Property Ownership in Rhode Island
Upon a landlord transferring ownership of the property, the landlord must notify the resident(s) of the name(s), address, and telephone number of the person or persons purchasing the property and assuming liability. The outgoing landlord is required to turn over the security deposit to the new owner.
Rhode Island landlords are recommended to charge security deposits for their protection. A landlord should be aware of the security deposit law to avoid future legal issues.
When in doubt, it’s best to hire a reliable and experienced property manager who has a clear understanding of Rhode Island landlord-tenant law. If you have any questions, reach out to our Stonelink Property Management experts and we’ll be happy to help you!
Disclaimer: This blog should not be used as a substitute for legal advice from a licensed attorney in your state. Laws change, and this post might not be updated at the time of your reading. Please contact us for any questions you have in regards to this content or any other aspect of your property management needs.