The Rent Security Deposit Act requires landlords who
rent 10 or more apartments to place tenants'
security deposits in either an insured money market
fund or a federally insured bank account. The
account must pay a rate of interest set at least
quarterly and equal to the average rate of interest
paid by the bank on money market accounts.
interest accounts must be in New Jersey-based
The law requires
landlords who rent fewer than 10 apartments to place
security deposits in bank accounts that pay at least
the regular rate of interest.
The law no longer
allows the landlord to keep any amount to cover his
or her administrative expenses.
The law now
requires that the interest earned on the deposit
must either be paid to you in cash every year or
subtracted from the amount of rent you owe on the
renewal or the anniversary of the lease. This must
be done either when your lease is to be renewed, or
on January 31 each year. (But the landlord must give
you a written notice that he or she will be paying
you on January 31 of each year instead of the date
your lease is renewed.)
See Also: Getting
Back Your New Jersey Security Deposit