The cap
A landlord can’t require more than 1.5 times one month’s rent as security. Additional security collected in a year can’t exceed 10% of the current deposit.
Where it’s held and interest
The deposit must be held in an account at a bank or similar institution in New Jersey, and the landlord must tell the tenant in writing where it is held. Interest belongs to the tenant and is paid or credited annually.
Getting it back
After the lease ends, the landlord must return the deposit with interest, minus itemized lawful deductions, within 30 days. Shorter timelines apply in some cases, like displacement by fire or flood.
Who it covers
The law covers most rental housing, but owner-occupied buildings with two or fewer rental units are exempt unless the tenant gives 30 days’ written notice invoking the law.
Questions, answered
Can a NJ landlord charge first, last and security?
A prepaid last month counts as security, and total security can’t exceed 1.5 months’ rent.
General information, not legal, tax or lending advice. Rules change; confirm with your attorney, tax professional or lender.