SECURITY DEPOSIT
The landlord is only allowed to make deductions from the security deposit once the lease has ended or been canceled. Additionally, the tenant's security deposit may only be used for:
The cost of any damage to the rental property.
Broken lease
Any breaches in terms of the rental agreement.
Tenant's Obligations
Only if the tenant's breach of a specified obligation resulted in the damage, may the landlord recover the cost of repairs. The following requirements must be met by the tenant in order to comply with the specified rule:
The structure or housing unit, as well as any amenities, equipment, or appurtenances, may not be damaged, defaced, removed, or impaired in any way by the tenant's invited visitors.
Not remove any portion of the building or housing unit, along with any associated amenities, equipment, or facilities, knowingly or carelessly.
Not allow anyone on the property to knowingly or wantonly interfere with other tenants' or neighbors' pleasant enjoyment of the space.
Returning Deposit
Time Frame
The security deposit and any unpaid or uncredited interest must be returned by the landlord to the tenant within 30 days after the end of the lease or the day the tenant vacates the property, whichever comes first. If the landlord plans to deduct money, they must also give the lessee a written list of the deductions and restore any remaining security deposit funds within the same time limit. The landlord shall be released from all liability if the tenant fails to give the landlord a forwarding address in writing.
Penalty for Failure to Return the Security Deposit on Time
The amount withheld from the lessee, which is the difference between the security deposit plus interest and the entire amount of permitted deductions, may be doubled if the landlord fails to restore the security deposit or what is left of it. Small Claims Court, commonly known as "Municipal Court" in Philadelphia or "Justice Court" throughout the rest of Pennsylvania, allows tenants to file lawsuits for up to $12,000.
Penalty for Failure to Provide the Written List
Landlords forfeit all rights to security deposits or any portion of them, as well as the right to bring legal action against the tenant for property damage, if the landlord does not provide the written list of deductions or claims on the deposit within 30 days of terminating the tenancy.
Failure of the Tenant to Provide a Forwarding Address
The landlord will be released from all responsibility for the security deposit and its accounting if the lessee fails to give the landlord a forwarding address.
Receipt Requirements
Under Pennsylvania security deposit laws, the landlord is not required to give the tenant a receipt for the tenant's deposit.
Last Month's Rent
Landlords often collect last month's rent upfront to provide financial security, ensuring they're covered if a tenant stops paying rent or leaves without notice, and to potentially cover damages beyond normal wear and tear. Tenants are less likely to vacate prematurely, as they've already committed financially to the last month.
Collecting last month’s rent adds an extra layer of financial protection for property owners. So, should your tenant stop paying rent, you are already one month ahead. Plus, you have the security deposit collected for issues such as non-payment of rent that you can now apply to any additional loss you experience.
Some tenants will try to ‘live-out’ their security deposit by not paying for rent and just letting the security deposit pay for the non-payment. Not collecting last month’s rent in advance leaves the landlord in a bind, especially if the tenant owes any excess beyond the security deposit for additional non-payment or damages. You are now looking at a day in court that every property owner tries to avoid at all costs.
It is not uncommon for tenants to think they can use the last month’s security deposit and skip out. So, this added cushion of collecting funds upfront allows landlords to rest a little easier. Having both security and last month means that if the tenant does skip, landlords have enough to cover the rent as well as possible damages.
Before moving in, a tenant often pays the last month's rent, which the landlord or property management company uses to cover the tenant's final month in the rental property. Landlords often ask for the last month's rent to financially protect themselves from renters who may try to avoid paying for the last month of their tenancy. The upside for tenants is that prepaying their last rent payment may ease the financial burdens of moving out and to a new location.
When you collect the last month's rent, and clearly label it as such, the tenant is paid up for that last month—whenever it happens to be, even if the rent has gone up in the meantime.