A security deposit can protect a landlord when a tenant leaves unpaid rent or damages a rental property. But Georgia landlords cannot simply keep the money whenever something goes wrong.
There are specific security deposit regulations covering how much landlords can charge, where security deposit funds must be held, how damage should be documented, and when the security deposit returned to the tenant is due.
If you own rental units in Atlanta, knowing the rules can help you avoid costly mistakes. Here is what landlords should know about Atlanta, GA security deposit laws and the rules for landlords under Georgia landlord-tenant law.
Key Takeaways
- Georgia caps security deposits at two months' rent for leases entered into or renewed on or after July 1, 2024
- Security deposit funds must sit in a bank escrow account or be backed by an approved surety bond, never mixed with operating funds
- Landlords generally have 30 days after regaining possession to return the deposit or send a written itemized statement
- Wrongfully withholding a deposit can mean paying three times the amount plus the tenant's attorney fees and court costs
What Is the Maximum Security Deposit in Georgia?
Under Georgia law, the maximum security deposit is two months' rent for leases entered into or renewed on or after July 1, 2024. So a $1,500 monthly rent caps the deposit at $3,000.
Georgia security deposit laws also cover payments landlords may not think of as a security deposit, including damage deposits, advance rent deposits, and pet deposits. This makes it important to clearly define each charge in the lease agreement, since application fees and other nonrefundable fees are treated differently from a refundable security deposit.
Atlanta also has local ordinances that may add requirements for certain landlords. Those who own or control more than 10 rental units and require a deposit above 60% of monthly rent must offer qualifying tenants certain alternatives.
Are Pet Deposits Included in the Security Deposit Maximum?
Pet deposits may be considered part of the security deposit under Georgia law. Landlords should review how the charge is structured and described in the lease before collecting it.
Where Should Landlords Keep Security Deposit Funds?
Georgia law generally requires landlords to place security deposit funds in a separate escrow account unless they use the permitted surety bond option. Landlords can also use a surety bond instead of an escrow account when the statutory requirements are met. Either way, security deposit funds should never simply be mixed with ordinary operating funds.
- In a bank escrow account established specifically for security deposits, held with a regulated bank or lending institution
- On file with tenants, who must receive written notice of the escrow account's location
- With a surety company authorized to do business in Georgia, if a landlord chooses the bond option instead
- With the clerk of the superior court in the county where the rental property is located, where the surety bond itself is filed
What Can a Landlord Deduct From a Security Deposit?
A landlord has the right to withhold a reasonable amount from a security deposit when there is a legal reason to do so, as long as the deduction fits within what Georgia landlord-tenant law and the lease allow. Landlords must also distinguish between tenant-caused damage and normal wear and tear, since deposit funds should never cover conditions considered ordinary deterioration. A tenant who fails to pay rent may still owe the unpaid amount, but that does not allow a landlord to skip the other security deposit requirements.
Landlords can deduct for:
- Unpaid rent owed under the lease agreement
- Certain other charges permitted under Georgia landlord-tenant law and the lease
- Damage caused by the tenant, depending on the circumstances
- Certain cleaning fees, depending on the circumstances
- Anything beyond normal wear and tear, such as a large stain caused by negligence, rather than minor carpet wear from ordinary use
When Must a Security Deposit Be Returned?
Georgia law generally requires the full security deposit to be returned within 30 days after the landlord obtains possession of the property under the applicable statutory process. If a landlord has a legal reason to withhold part of the deposit, the tenant must receive a written statement explaining the reasons, along with any remaining funds.
Landlords should:
- Return the deposit, or send a written statement plus remaining funds, within 30 days of regaining possession
- Keep proof of when the security deposit was sent
- Keep a record of the tenant's last known address
- Make a reasonable effort to locate the tenant if a payment is returned as undeliverable, before following the statutory process for unclaimed funds
What Happens If a Landlord Fails to Follow the Rules?
A landlord who fails to meet escrow or surety bond requirements may lose the right to retain the security deposit. Failure to provide required damage lists or statements can also affect a landlord's right to withhold money. Beyond that, a landlord who wrongfully withholds a deposit can face liability for three times the amount improperly withheld, plus reasonable attorney fees, subject to the statutory exception for certain bona fide errors.
Depending on the dispute, a tenant may pursue legal action in a court with jurisdiction, whether that's magistrate court or superior court. Court costs and a tenant's attorney fees may also become part of the case when allowed by law. The superior court clerk may get involved too, particularly when a landlord uses a surety bond.
How Can Atlanta Landlords Stay Compliant?
Keeping up with security deposit laws does not have to be complicated. Landlords must have a consistent process for collecting, holding, documenting, and returning security deposits.
A practical checklist includes:
- Follow the two-month security deposit maximum.
- Use the required escrow account or surety bond.
- Provide tenants with required written notices.
- Document existing damage before occupancy.
- Complete the required move-out inspection.
- Separate normal wear from tenant-caused damage.
- Document valid deductions.
- Provide the required written statement.
- Return the remaining security deposit in a timely manner.
- Keep records of inspections, notices, payments, and repairs.
Landlords should also remember that Georgia state law is not the only consideration. Atlanta local ordinances may create additional requirements for certain rental units.
Short-term rentals can also have different requirements and should not automatically be treated like standard residential rentals.
FAQs About Georgia Security Deposit Laws
Q: Can a Georgia landlord charge more than two months' rent?
Generally, no. For covered residential lease agreements entered into or renewed on or after July 1, 2024, Georgia law limits the security deposit to two months' rent.
Q: Can a landlord keep a deposit for cleaning fees?
Potentially. A landlord may be able to deduct reasonable cleaning costs in situations allowed by Georgia law. However, landlords cannot charge tenants for normal wear.
Q: Does every landlord have to use an escrow account?
Georgia generally requires covered landlords to use an escrow account or an allowable surety bond. Certain owners with fewer rental units may qualify for an exemption from some requirements when the statutory conditions are met.
Protect Your Atlanta Rental Property
Security deposits are only one part of managing a rental property. Tenant screening, lease enforcement, inspections, maintenance, and proper notice all play a role in protecting your investment.
At Property Services of Atlanta, we manage the details that come with rental ownership. A consistent process makes it easier to protect your property while respecting tenant rights.
Georgia security deposit laws can change, and individual situations may require legal advice. Landlords should review the current state law or speak with a qualified Georgia attorney when dealing with a dispute or complex situation.
Let's talk about building a process that keeps your Atlanta rental property compliant from move-in to move-out. Reach out to Property Services of Atlanta to get started.
