Delaware Security Deposit Laws

Author: Kasee Godwin
Date: 11.08.2022

Security deposit regulations in the state of Delaware are clearly outlined for property owners and renters alike. The limit property owners can charge for an application fee, the amount of the security deposit, and the way in which security deposits must be held are all readily available. Continue reading below in order to gain a better understanding of regulations regarding security deposits for rental properties in the state of Delaware.

Is there a limit on how much the property manager/owner can charge for an application fee? If so, what is that amount?

Property owners in the state of Delaware may charge up to $50 for an application fee or 10% of one month rent, whichever is greater. Application fees are nonrefundable.

What is the security deposit amount the landlord can collect?

As a Delaware property owner, you can request a security deposit of up to one month’s rent to protect your property in the event of damages or unpaid rent on all units whose lease the term is more than one year. For rental properties that have a shorter timeframe, or are on a month-to-month basis, there is no security deposit limit for the first year. Following the first year, the limit is one month’s rent. At this time, property owners must return to the renters the amount that exceeds one month rent. There is no limit on the security deposit property owners can request for furnished apartments.

Can the property manager/owner collect a fee for pets?

A pet deposit separate from the apartment security deposit is allowed in the state of Delaware for up to one month rent, regardless of the length of the lease. Service pets are an exemption, and disabled persons with service pets do not have to pay an additional security deposit. However, if a service dog causes damages, the resident is still liable for expenses incurred.

How does the security deposit need to be held?

Property owners in the state of Delaware must place the security deposit into an escrow bank account in a federally insured banking institution. The account must be kept separated from other accounts the property owner may have and cannot be used for other businesses.

Is the property manager/owner required to tell the resident where the deposit is held?

Yes. Property Owners in Delaware must inform renters where their security deposit is kept within 20 days of the renter requesting.

Is the property manager/owner required to tell the resident what the interest rate on the account is (if applicable)?

No. Property owners in the state of Delaware are not required to tell the resident what the interest rate on the security deposit is, nor are they required to pay the residents the interest at the end of the lease.

What can the property manager/owner deduct from the security deposit?

Property managers operating in Delaware may keep a portion of the security deposit to cover unpaid rent or damages that exceed normal wear and tear. Property owners in Delaware may also use the security deposit to cover the costs of expenses incurred due to renovation and re-renting properties in the event of premature termination of the lease.

How long does the property manager/owner have to return the security deposit after the lease has ended?

In the State of Delaware, the security deposit, or its remainder (after additional costs have been incurred, if applicable) must be returned to the renter within 20 days of the lease expiration. In the event of deductions, the property owner must provide the renter with an itemized list of all the deductions within the 20 day time limitation.

What penalties does the property manager/owner face if they do not return the security deposit on time?

Property owners operating in Delaware that do not return renters their security deposit within 20 days may be fined up to double the amount of the security charges. property owners that fail to provide an itemized list of deductions, if available, lose the right to make a deduction. Renters have 10 days from receipt of the itemized list of deductions to dispute the charges.

What is the process for the property manager/owner to claim the security deposit funds?

All notices and communications between renters and property owners in the state of Delaware must be sent to the respective addresses the two provided in their rental agreement.

Is the resident allowed to apply their security deposit towards the last month’s rent?

According to Delaware law, renters cannot choose to use the security deposit in place of their last month’s rent, unless the property manager/owner agrees to it in writing.

To summarize, security deposit legislation in the state of Delaware is relatively straightforward, and all parties involved should have a clear indication of the application fee, the maximum security deposit amount allowed, what can be deducted, and how the security deposit must be returned to renters. As always, property managers must keep an accurate account of damages and provide that information to tenants if applicable upon termination of the lease.

Disclaimer & Sources:

Qira aims to keep this information as up-to-date as possible. The content provided here is for informational purposes and should not replace legal counsel. Please refer to the relevant government sources to check for any changes or updates to the law.


Kasee Godwin

Position: Director of Marketing
Social Networks

Kasee is the Director of Marketing for Qira. She has nearly 15 years of experience in the real estate marketing industry, including 10 years on the client side. In her spare time, she enjoys reading science fiction, exploring new wineries, and fostering Golden Retrievers.

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