New York Security Deposit Return Law & Calculator

1. The 14-Calendar-Day Return Rule (N.Y. Gen. Oblig. Law § 7-108(1-a)(e))

Under New York General Obligations Law § 7-108(1-a)(e), housing providers have a mandatory window of exactly 14 calendar days after the tenant has vacated the premises to deliver:

• A full refund of the security deposit, OR
• An itemized statement indicating the basis for the amount retained, along with a refund of any remaining portion.

The 14-day clock starts on the calendar day the tenant physically vacates and returns possession (including all keys). It is not measured from lease expiration if the tenant vacated earlier.

2. Automatic Statutory Forfeiture of Retention Rights

Unlike states where a landlord can retain deductions even after missing a notice window, New York contains an explicit, non-waivable statutory forfeiture clause:

If your landlord does not deliver the itemized statement and refund check by day 14, they lose all legal authority to retain deposit money for alleged repairs, cleaning, or turnover costs. Under § 7-108(1-a)(h), any lease clause attempting to waive or modify this rule is completely void.

3. Statewide Security Deposit Cap: 1 Month's Rent (§ 7-108(1-a)(a))

Enacted under the Housing Stability and Tenant Protection Act of 2019 (HSTPA), New York established a strict ceiling on residential rental deposits statewide:

4. Tenant Right to a Pre-Move-Out Inspection (GOL § 7-108(1-a))

After either party delivers a notice of lease termination or intent to vacate, the landlord must notify the tenant in writing of their right to request an inspection before vacating:

• Timing: The walkthrough must occur no earlier than two weeks and no later than one week before move-out.
• 48 Hours Notice: The landlord must give at least 48 hours advance written notice of the inspection date and time.
• Written Itemization: After the inspection, the landlord must give the tenant an itemized statement specifying defects or conditions that would justify deductions.
• Opportunity to Cure: The tenant has the statutory right to repair or clean identified deficiencies before moving out to preserve their deposit. Track items room-by-room with our move-in move-out checklist.

5. Bank Trust Accounts & Interest in Buildings with 6+ Units (N.Y. Gen. Oblig. Law § 7-103)

Under N.Y. General Obligations Law § 7-103, tenant security deposits remain the personal property of the tenant and are held in trust:

• No Commingling: Landlords cannot mix deposit funds with their personal or business operating accounts (§ 7-103(1)).
• Interest Bearing Account (6+ Units): If the rental property contains six or more residential units, the landlord must deposit security funds in an interest-bearing account in a New York banking organization (§ 7-103(2-a)).
• Administrative Fee: The landlord is entitled to keep 1% per year of the deposit amount for administrative expenses. All remaining interest earned belongs to the tenant and must be applied to rent or paid annually.
• Notice of Deposit: The landlord must inform the tenant in writing of the bank's name, address, and the amount deposited within a reasonable time (§ 7-103(2)).

6. NYC Rent-Stabilized Leases (RSC § 2525.4 & GOL § 7-107)

In New York City and counties covered by the Emergency Tenant Protection Act (ETPA), rent-stabilized apartments are subject to both the General Obligations Law and the Rent Stabilization Code (9 NYCRR § 2525.4):

7. Normal Wear and Tear vs Lawful Deductions (§ 7-108(1-a)(c))

Under N.Y. Gen. Oblig. Law § 7-108(1-a)(c), deposit deductions are lawful only for unpaid rent, unpaid utility bills owed directly to the landlord, and damage caused by the tenant beyond normal wear and tear:

In any legal dispute, the landlord bears the burden of proving that damage exceeds ordinary wear and tear and that claimed deduction costs are reasonable.

8. Punitive Damages: Up to Twice Deposit for Willful Retention (§ 7-108(1-a)(g))

If a New York landlord willfully violates deposit return rules, subdivision (1-a)(g) establishes significant statutory liability:

Examples of willful violations include ignoring tenant demand letters, refusing to provide an itemized statement after missing the 14-day cutoff, and fabricating repair bills.

9. How to Demand Your Deposit Refund

If your landlord has missed the 14-day statutory deadline or withheld unauthorized deductions without supporting invoices, follow these steps:

1. Deliver a Statutory Demand Letter: Send a formal demand citing N.Y. Gen. Oblig. Law § 7-108(1-a)(e) and highlighting that retention rights have been forfeited.
2. File in Small Claims Court: New York provides accessible small claims procedures with no attorney required:
   • NYC Civil Court (Small Claims Part): Claims up to $10,000.
   • City Courts outside NYC: Claims up to $5,000.
   • Town and Village Courts: Claims up to $3,000.
3. File with the NY Attorney General: You can submit a mediation complaint to the New York State Attorney General's Bureau of Consumer Frauds and Protection.

Official New York Statutes & Legislative Sources

• • New York General Obligations Law § 7-108 — Residential security deposit protections, 14-day return rule, 1-month cap, walkthrough inspections, and punitive damages.
• • New York General Obligations Law § 7-103 — Money deposited or advanced for use or rental of real property; trust accounts and interest rules for 6+ units.
• • New York General Obligations Law § 7-107 — Application of deposit return and itemized statement rules to rent-stabilized housing units.
• • New York Real Property Law § 238-a — Limitation on application fees ($20 maximum) and late fees.
• • New York Real Property Law § 226-c — Required written notice periods (30, 60, or 90 days) for non-renewal or rent increases.