Does a landlord have to pay interest on a security deposit?

It depends on the state. Seayora holds a published statute for 13 states and the District of Columbia. The table below gives the figure for each, with the statute it comes from.

How the interest works, state by state

StateHow the interest worksSource
ConnecticutInterest at the Banking Commissioner's published rate, paid annually.Conn. Gen. Stat. § 47a-21
District of ColumbiaInterest at not less than the statement savings rate of the D.14 DCMR §§ 308–311 (as amended by D.C. Law 16-276)
IllinoisInterest required on buildings with 25+ units held 6+ months; Chicago RLTO applies its own rate.765 ILCS 710/1; 765 ILCS 715/1
IowaInterest earned in the first five years belongs to the landlord; thereafter to the tenant.Iowa Code § 562A.12
MarylandSimple interest at the greater of 1.Md. Code, Real Prop. § 8-203
Massachusetts5 % or the bank rate, paid annually; the deposit must be in a separate Massachusetts account named to the tenant.M.G.L. c. 186, § 15B
Minnesota1 % simple interest per year.Minn. Stat. § 504B.178
New HampshireInterest required when the deposit is held a year or longer.RSA 540-A:6–7
New JerseyDeposit must sit in an interest-bearing New Jersey account; interest is paid or credited annually.N.J.S.A. 46:8-19 to 46:8-21.1
New MexicoInterest at the passbook rate on deposits over one month's rent for leases of a year or more.N.M. Stat. § 47-8-18
New YorkBuildings of six or more units must hold the deposit in an interest-bearing New York account; the owner may keep 1 % as an administrative fee.N.Y. Gen. Oblig. Law § 7-108(1-a)
North DakotaInterest required when held nine months or longer.N.D. Cent. Code § 47-16-07.1
Ohio5 % per year on the portion over $50 or one month's rent when held six months or longer.Ohio Rev. Code § 5321.16
PennsylvaniaDeposits over $100 must be escrowed; interest (less a 1 % fee) is paid after the second year.68 P.S. § 250.511a–250.512

This is a summary of a published statute, not legal advice. Rules change, local ordinances can add to them, and the terms of a specific lease may differ. Check the citation and speak to a lawyer before acting.

Only states where Seayora holds a published statute appear above. Where no statute is recorded, no figure is shown rather than a guess.

The answer in full, for the biggest rental markets

Does a landlord have to pay interest on a security deposit in New York?

Yes. New York requires a landlord to pay the tenant interest on a security deposit. Buildings of six or more units must hold the deposit in an interest-bearing New York account; the owner may keep 1 % as an administrative fee. The deposit itself must be returned within 14 days of the end of the tenancy. This is N.Y. Gen. Oblig. Law § 7-108(1-a).

More on New York

Does a landlord have to pay interest on a security deposit in Pennsylvania?

Yes. Pennsylvania requires a landlord to pay the tenant interest on a security deposit. Deposits over $100 must be escrowed; interest (less a 1 % fee) is paid after the second year. The deposit itself must be returned within 30 days of the end of the tenancy. This is 68 P.S. § 250.511a–250.512.

More on Pennsylvania

Does a landlord have to pay interest on a security deposit in Illinois?

Yes. Illinois requires a landlord to pay the tenant interest on a security deposit. Interest required on buildings with 25+ units held 6+ months; Chicago RLTO applies its own rate. The deposit itself must be returned within 45 days of the end of the tenancy. This is 765 ILCS 710/1; 765 ILCS 715/1.

More on Illinois

Does a landlord have to pay interest on a security deposit in Ohio?

Yes. Ohio requires a landlord to pay the tenant interest on a security deposit. 5 % per year on the portion over $50 or one month's rent when held six months or longer. The deposit itself must be returned within 30 days of the end of the tenancy. This is Ohio Rev. Code § 5321.16.

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Does a landlord have to pay interest on a security deposit in New Jersey?

Yes. New Jersey requires a landlord to pay the tenant interest on a security deposit. Deposit must sit in an interest-bearing New Jersey account; interest is paid or credited annually. The deposit itself must be returned within 30 days of the end of the tenancy. This is N.J.S.A. 46:8-19 to 46:8-21.1.

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Does a landlord have to pay interest on a security deposit in Massachusetts?

Yes. Massachusetts requires a landlord to pay the tenant interest on a security deposit. 5 % or the bank rate, paid annually; the deposit must be in a separate Massachusetts account named to the tenant. The deposit itself must be returned within 30 days of the end of the tenancy. This is M.G.L. c. 186, § 15B.

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Does a landlord have to pay interest on a security deposit in Maryland?

Yes. Maryland requires a landlord to pay the tenant interest on a security deposit. Simple interest at the greater of 1.5 % a year or the daily U.S. Treasury yield curve rate for 1 year as of the first business day of the year, accruing monthly, owed once the deposit has been held 6 months, on deposits of $50 or more. The deposit itself must be returned within 45 days of the end of the tenancy. This is Md. Code, Real Prop. § 8-203.

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Does a landlord have to pay interest on a security deposit in Minnesota?

Yes. Minnesota requires a landlord to pay the tenant interest on a security deposit. 1 % simple interest per year. The deposit itself must be returned within 21 days of the end of the tenancy. This is Minn. Stat. § 504B.178.

More on Minnesota

How Seayora uses this rule

Seayora computes the deadline this rule sets from the tenancy’s own dates, shows it on the deposit statement, and reminds the landlord before it falls due — so the answer above is not reference material sitting beside the product, it is the rule the product enforces.

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