Short answer: since October 1, 2024, a Maryland security deposit cannot be more than one month’s rent. You must give a receipt, hold the deposit in a separate account at a Maryland branch of a federally insured bank, and return it with interest and an itemized list of any deductions within 45 days after the tenancy ends. Source: Maryland Real Property 8-203.
How much you can collect
The cap is one month’s rent per unit, however many tenants sign the lease. The only exception allows up to two months when the tenant qualifies for state utility assistance, the lease has the tenant pay utilities to the landlord, and both agree in writing. In total, you cannot require more than two months’ rent at lease signing, deposit and first month combined. Source: Maryland DHCD.
Receipts and holding the money
- Give the tenant a receipt and include it in the written lease.
- Deposit the money within 30 days in an account used only for security deposits, at a Maryland branch of a federally insured institution.
- Tell the tenant in writing, when you take the deposit, that they may be present at the move-out inspection if they send 15 days’ notice by certified mail.
Returning the deposit
- Return the deposit within 45 days after the tenancy ends.
- Add simple interest at the greater of 1.5% a year or the one-year Treasury rate set on the first business day of the year. Interest applies to deposits of $50 or more held at least six months.
- Send any deductions as an itemized list, with supporting documents, by first-class mail within the same 45 days. Miss that and you lose the right to withhold.
What mistakes cost
A tenant can recover up to three times an overcharged or wrongfully withheld amount, plus attorney’s fees. Documented move-in and move-out inspections are the best protection. See our inspections service.
Own a rental in Maryland? Get a free rental analysis. We tell you what the property should rent for and which of these rules apply to it.