Maryland security deposit rules.
The Maryland rules for residential security deposits in plain English: how much can be charged, how fast it comes back, whether interest is owed, and what catches operators out.
Last reviewed · Statute: Md. Code Ann., Real Prop. § 8-203 · Not legal advice
How much can be charged
Capped at one month’s rent per unit since October 1, 2024 (Renters’ Rights and Stabilization Act); any “pet deposit” counts toward it. Up to two months only where the tenant qualifies for utility assistance, pays utilities directly to the landlord and both agree in writing. Overcharging exposes the landlord to up to 3× the excess plus attorney’s fees. Tenants may offer a surety bond instead of a deposit.
When it has to come back
45 days from termination, with itemised deduction list. Tenant must be informed of right to attend the move-out inspection.
Interest
Simple interest at the greater of the one-year U.S. Treasury yield curve rate (as of the first business day of the year) or 1.5% per year, accruing monthly and not compounded. Due only if the deposit was held at least six months and is $50 or more, paid with the deposit within 45 days of the end of the tenancy.
Where the money has to sit
Deposits must be held in a federally insured Maryland branch banking institution within 30 days of receipt.
What catches operators out
- Move-out inspection notice rule: missing it forfeits the right to deduct.
- 1.5% is a floor under the Treasury-indexed rate. Interest is payable only on deposits of $50 or more held at least six months.
What this looks like with Standby in Maryland.
When a resident takes a Standby certificate there is no cash deposit to hold, so the cap, the return deadline and the interest rules above have nothing to attach to. You are covered up to the full deposit and draw on it when you need to.
When a resident pays cash instead, Standby handles that deposit under your lease and Maryland law, so your team is not tracking interest and return deadlines by hand.
This page summarises the most common single-family and multifamily residential rule in Maryland. Furnished units, senior leases, mobile-home tenancies and short-term rentals can differ, and city ordinances may override the state default. Check the statute before relying on a figure for a specific lease.