What Tenants Should Know about Rent Deposits
Did you know it is illegal for a landlord to ask a renter for a security or damage deposit?
The only deposit a landlord can collect is the first and last months’ rent, otherwise known as a rent deposit. This cannot be used for anything else, such as to pay for damages to the unit.
If the rent increases after a tenant has paid a rent deposit, the landlord can ask that the tenant top it up so that it is the same as the new rent.
If the landlord asks for a key deposit, it is refundable once the lease agreement ends and/or the tenant moves out. The property owner must give the deposit back at the time the tenant turns in their key(s).
Should the tenant fail to return the keys, the deposit monies retained by the landlord cannot exceed what it would cost to replace them.
If a landlord asks for any other deposit (in addition to first and last months’ rent and a refundable key deposit), they’ll have to pay it back to the tenant. If not, they may face a fine under the Residential Tenancies Act or the Ontario Human Rights Tribunal.
Should a tenant damage a unit or cause damage to the building, the landlord can issue a notice of termination and/or request that the renter pay for the damages. If the tenant does not pay, the property owner can contact the Landlord and Tenant Board to determine the next steps.