When managing rental properties in Virginia, you must abide by certain rules.
The Virginia landlord-tenant law limits how much you can collect, what deductions you can make, and the timeline for return, among other things.
Failure to abide by these Virginia landlord-tenant laws can result in certain repercussions for rental property owners. You could, for instance, be held liable for damages and reasonable attorney fees.
The following are important highlights of the Virginia security deposit laws.
Security Deposit Limit in Virginia
Virginia landlords and rental property owners have a right to deduct money from the tenant’s security deposit to cover damages, unpaid utility bills, or unpaid rent.
There is a limit to how much landlords can charge a tenant for a security deposit as per Virginia security deposit laws. Virginia's security deposit limits state that the maximum security deposit amount must not exceed the equivalent of 2 months’ rent.
If the monthly rent amount is, say $1,700, then you cannot require the Virginia tenant to pay anything more than $3,400 as a security deposit amount.
Storage of Security Deposits
Before 2014, the Virginia landlord-tenant law required landlords to store their tenants’ security deposits in accounts that bore interest. The interest would be at a rate below the discount rate of the Federal Reserve.
Under the old residential landlord and tenant act, Virginia landlords and property owners would only need to make the payment to tenants who had lived in the property for at least 13 months. The interest payment was due to the tenant at the end of their rental agreement term.
This is, however, not the case anymore under Virginia law. After 2014, the security deposit laws that required a tenant’s security deposit to be in an interest-bearing account were removed.
This means that you can keep a security deposit amount in a normal account, interest-bearing account, escrow account, or even as a surety bond. The choice is entirely yours to make!
Security Deposit Deductions
Virginia residential landlords must make deductions from tenants' deposits as per Virginia law. The reasons to deduct costs are as follows:
Unpaid Utility Bills: A tenant is responsible for paying any utilities that are due to them before moving out.
If the tenant fails to pay them, you can make appropriate deductions from their security deposit.
Unpaid Rent: A tenant must pay rent for the entire duration of the lease or rental agreement, including any unpaid amounts.
Abandoning the dwelling unit, conducting a breach of the rental agreement, or terminating the lease without a justified reason won’t absolve a tenant from the non-payment of rent.
Excessive Property Damage: Most leases require tenants to return their dwelling unit in the same condition they found it in, minus normal wear and tear.
If a tenant damages the unit beyond normal wear and tear, you can use part or all of the security deposit to cover the restoration cost.
Usually, to make these cost deductions, you must wait for the tenant to move out from their rented premises.
Should you need to take out the tenant’s security deposit before their lease or rental agreement is over, you must provide written notice to them at least 30 days before determining the date the tenant vacates. Proper notice to the tenant must be in writing.
Security Deposit Records
Virginia residential landlords are required to keep tenants’ security deposit records for when they return the security deposit. You can use these records to note any deductions you have made on tenants’ deposits over the last 2 years.
These security deposit receipts and records must be available on demand, especially if required by the tenant or their attorney when it comes time for a security deposit refund.
Walk-Through Inspections
Under the Virginia security deposit laws, landlords have a right to perform walk-through inspections. If you decide to exercise this right, then you must keep the following things in mind:
Make a reasonable effort to notify the tenant of their right to be present for the inspection.
Provide the tenant with a written notice at least five days before the inspection. After the notification, the tenant can decide whether or not to be present.
If the tenant may choose to be present, they must provide their response in writing.
The day of the move out inspection must be at least 3 days before the tenant moves out.
If you wish, both landlord and tenant can attend the inspection.
After the inspection, you must provide the tenant with a written receipt or,itemized list of deductions for any damages found. There may be security deposit disputes, where the tenant argues against the allowable deductions. If this comes to pass at the termination of a tenancy, the tenant may take the property owner to small claims court.
Returning a Tenant’s Security Deposit in Virginia
In Virginia, landlords must return their tenant’s security deposit within 45 days after the tenant vacates, minus any allowable deductions, to their new forwarding address.
If withholding part or all of the tenant’s deposit, you must provide the tenant with an itemized statement as per Virginia code. The itemized list must include the following important details for the sake of clarity:
How much of the security deposit you’re returning.
Deductions you have made to their security deposit, including the repair costs or to cover unpaid rent.
The method of the written notice delivery must either be via certified mail or hand delivery. If the damages exceed the security deposit, however, then you must notify the tenant within 45 days of the tenant’s move out date.
Change of Property Ownership
If the rental unit’s ownership changes hands during a tenancy, it’ll be the current owner’s responsibility to transfer the security deposit held, or whatever portion remains, to the tenant.
The incoming landlord would then need to ask the tenant for a security deposit, as well as abide by the relevant rules.
Frequently Asked Questions
1. What Is Considered Normal Wear and Tear in Virginia?
In Virginia, “normal wear and tear” is defined as normal deterioration that occurs as a result of normal use of the rental unit.
Examples include faded paint and flooring, gently worn carpets, and loose door handles.
Damage, on the other hand, is dwelling unit destruction that results from abuse, misuse, negligence, or carelessness by the tenant.
Examples include missing fixtures, holes in the wall, or broken tiles or windows.
2. Can a Tenant in Virginia Use the Deposit as Last Month’s Rent?
No, this is against the state’s security deposit rules. Landlords may can include this as part of the lease agreement for clarity’s sake.
3. What Happens if a Landlord Fails to Follow These Rules?
If you fail to follow any of these rules, the repercussions could be severe.
You may lose the right to withhold any portion of the deposit, and be made to cover the tenant's reasonable court and attorney fees.
Conclusion
As a landlord in Virginia, observing the Virginia landlord tenant law is key to becoming successful. Keeping up can become arduous, especially if you’re an out-of-state investor or have a full-time job.
Fortunately for you, Abrams Realty can help. We provide the best rental property management services in Virginia Beach.
Our focus is on residential, commercial, and multi-family properties. Get in touch today to learn more!
Disclaimer: Please note that the information provided in this blog is intended for general guidance and should not be considered as a replacement for professional legal advice. It is important to be aware that laws pertaining to property management may change, rendering this information outdated by the time you read it.
