For property owners or their agents (“Landlord”), security deposits are a safety net that helps protect against potential financial losses due to residents’ unpaid rent or damage to the rental. In Rhode Island, landlords are allowed to collect a security deposit prior to a tenant taking possession of a unit.
A landlord 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 tenant's neglect, abuse, or lease agreement violations. Keep reading to learn more about this facet of Rhode Island landlord-tenant law.
Guide to Rhode Island Security Deposit Law
1. Security Deposit Limit
Most states set a maximum security deposit that can be collected. In Rhode Island, landlords are allowed to collect a tenant's security deposit not to exceed to one month’s rent.
2. Nonrefundable Fees
The deposit must be refundable when the Rhode Island tenant moves out. Should the landlord charge other non-refundable fees (i.e. non-refundable pet fees), the lease or rental agreement should clearly identify these fees as non-refundable.
3. Storing a Tenant’s Deposit in Rhode Island
The state's security deposit policies do not require landlords to disclose where the deposit is held or earned on security deposits.
4. Written Notice after 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 deposit is held or any income earned on that 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 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 causes financial losses. Security deposits can be used to cover any unpaid rent.
- Pay for trash disposal: In Rhode Island, landlords can charge residents for reasonable trash disposal expenses. If residents fail to pay such fees, landlords are entitled to deduct the fees from the security deposit.
- Pay for reasonable cleaning expenses: In Rhode Island, landlords can charge residents for reasonable cleaning expenses 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 deposit.
- Cover damages exceeding normal wear and tear: Landlords are required to repair wear and tear without charging the tenant for it. However, if the damage was due to residents’ neglect, abuse, or lease or rental agreement violations, the landlord can deduct the cost of damage from the security deposit.
Security deposit laws in Rhode Island do 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 wear and tear from the deposit.
Other deductions that landlords may charge from security deposits include:
- Carpet replacement: A landlord in Rhode Island can charge residents for carpet replacement if the damage is not part of standard 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 expense can also be deducted from the deposit.
6. Walk-Through Inspections
There is no statute under security deposit laws in Rhode Island 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 premises. Consider including a clause in the lease about walk-throughs.
7. Security Deposit Refund in Rhode Island
In Rhode Island, landlords are required to return security deposits (or any unused portion of the deposit) by mail with notice to the former resident’s forwarding address within 20 days after the following required conditions have been met:
- When the tenant delivers possession of the rental to the landlord.
- After the tenant informs the landlord of their new forwarding address.
If a landlord fails to return the remaining security deposit or wrongfully withholds the deposit (or 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 rental unit, the landlord must notify the resident(s) of the name(s), address, and telephone number of the person or persons purchasing the premises and assuming liability. The outgoing landlord is required to turn over the security deposit to the new owner.
Conclusion
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.
