Oklahoma landlords, just like their counterparts elsewhere in the country, have a right to require a security deposit from their tenants. And for good reason. Requiring a security deposit helps provide cushion against a myriad of potential liabilities.
A common potential liability is negligent property damage by the tenant. Examples include:
- Missing or damaged door locks/handles
- A hole in the middle of the door
- A smashed window
- A broken toilet seat
These are instances for which a security deposit would come in handy. You would be well within your rights to make the appropriate deductions from their deposit.
A security deposit would also help you minimize your losses in the event a tenant abandons the unit. Once a tenant signs a lease, they agree to rent the property until the expiry of the Oklahoma rental agreement. So, if a tenant breaks it midway, that amounts to a serious violation of the agreement according to Oklahoma landlord-tenant laws.
Other ways in which a security deposit can help cut your losses as a landlord include:
- If a tenant moves out without clearing their utility bills.
- If a tenant stops paying rent without a legal justification.
With that in mind, Oklahoma landlords must follow certain rules when handling their tenants' security deposits. Among other things, you have to know how to store it and when to return it.
Oklahoma Security Deposit Laws
What is the maximum security deposit that Oklahoma landlords can charge their tenants?
Different states have different rules in regard to the security deposit limit. In Oklahoma, landlords aren't limited to how much security deposit they can charge their tenants. However, make sure to check with your local city or town as additional rules may apply.
Also, it may be in your best interests not to overcharge your tenants. That's because setting a high security deposit limit could make your rental undesirable to prospective tenants.
Generally, landlords in Oklahoma only charge up to 3X the monthly rent as security deposit. So, if the monthly rent is, say, $1,000, most landlords only require tenants to pay a maximum of $3,000.
How should you store your tenants' security deposits?
In Oklahoma, landlords are required to store their tenants' security deposits in escrow accounts. The financial institution with the account must be located in Oklahoma and be insured at the federal level. This is is part of Oklahoma tenant rights.
It's not mandatory for the account to accrue any interest.
It's illegal to use a tenant's security deposit for personal use. Misappropriating the deposit could land a landlord a fine of up to 2X the deposit amount or even a jail term of up to six months. (OK Stat § 41-115 (A)).
Do landlords have to provide their tenants a written notice after receiving their security deposit?
This isn't mandatory for Oklahoma landlords. Having said that, most landlords often do it. In the notice, they make sure to state the amount received, how they are going to store it, and what the tenant must do in order to get a full refund.
What are the common reasons for keeping a tenant's security deposit?
In certain circumstances, landlords have a right to a part or all of the tenant's security deposit. The following are the common instances:
- Unpaid rent. Nonpayment of rent is a serious violation of the lease and could even result in eviction. You could use part or all of their deposit to cover your losses.
- Damage in excess of normal wear and tear. Examples include a smashed bathroom mirror, a missing door lock, or a broken toilet seat. You can use part or all of the tenant's deposit to pay for costs of fixing the damage.
- Unpaid utility bills. Tenants must clear all utility bills that the lease has put on their name. If they don't, again, you can use their deposit to pay for the bills.
Are Oklahoma tenants entitled to a walk-through inspection?
A walk-through inspection is where both the landlord and tenant walk through the property to ascertain its condition relative to its initial condition at move in. The landlord uses the move-in inspection checklist as a reference.
The tenant becomes liable for any damages exceeding normal wear and tear. The tenant must fix them before the final walk-through inspection.
Can a tenant use the security deposit to pay last month's rent?
A security deposit isn't intended to be used to cover the last month's rent. This provision, however, can be established by both parties in the lease agreement.
When should Oklahoma landlords return their tenants' security deposits?
Once a tenant moves out of their rental, according to Oklahoma renters' rights, they have up to 6 months to request for the return of their deposit. But if they don't, then the deposit becomes yours to keep.
Once you get the request, you'll have up to 30 days to honor it. You must mail it to the tenant's last known mailing address.
If you made any deductions, you must include an itemized statement alongside the remaining portion of the deposit. The statement must be written and include any deductions made, as well as their estimated repair costs.
Wrongfully withholding a tenant's deposit can lead to a number of consequences. These include paying the tenant the full amount of the deposit you've wrongfully withheld. (OK Stat § 41-115 (E))
What happens in the event the ownership of the property changes?
In case the property is sold, foreclosed on, or otherwise changes hands, an Oklahoma landlord will have two options to consider.
One option would be to return the deposit, less any allowable deductions, back to the tenant. You'll then need to notify the incoming landlord of the same.
The other option would be to transfer the deposit to the incoming landlord. You must then communicate about doing so to your tenants. The communication must be written, and must also include the new owner's name and address.
Disclaimer: This information is by no means a substitute for professional legal advice. Laws keep changing, and the content herein may not be up to date at the time of your reading. For expert help, please consider hiring a professional property management company.