Security deposit interest in California
No — California does not require landlords to pay interest on security deposits.
There is no interest to calculate — here is what does apply
California sets no interest requirement, so there is no figure to work out. The rules below are the ones that decide whether you get your deposit back in full, which is usually the larger sum anyway.
Deadline to return your deposit
21 days after the tenancy ends.
Miss it and the consequences below start to apply.
What to do next
- Give your landlord a written forwarding address. Several states make the return duty conditional on it, and California's rules are summarised below.
- Photograph the unit at move-out, dated, before you hand back the keys. The dispute is almost always about condition.
- If the deadline passes, put the request in writing and cite Cal. Civ. Code Sec. 1950.5. Keep a copy of what you sent and when.
Not legal advice. This is general information, not legal advice. Security deposit laws change and vary by jurisdiction. Verify with the cited statute or consult a licensed attorney in your state before taking action.
What does California law actually say?
California does not require landlords to pay interest on residential security deposits at state level. The statute contains no interest provision and imposes no escrow or separate account requirement, and it expressly preempts local ordinances on most deposit matters, though several cities including San Francisco, Los Angeles, West Hollywood and Santa Monica have long-standing local deposit interest ordinances that may still apply. Since 1 July 2024 deposits are generally capped at one month's rent whether the unit is furnished or unfurnished, with a two-month exception for small landlords who are natural persons owning no more than two residential properties comprising no more than four total units, though that exception does not apply to service members.
Deposits are held in trust and may only be claimed for unpaid rent, cleaning to the level of cleanliness at the start of the tenancy, repair of damage beyond ordinary wear and tear, and restoration of personal property where the lease allows. Landlords must offer a pre-move-out inspection and give the tenant an itemised statement of proposed repairs so the tenant can remedy them. Within 21 days of the tenant vacating, the landlord must return the deposit or deliver an itemised statement with receipts and documentation, including photographs taken before the tenancy, at move-out and after any repairs.
What if your landlord does not comply?
No interest obligation at state level, so no state interest penalty. A landlord who retains any portion of the deposit in bad faith is liable for statutory damages of up to twice the deposit, in addition to actual damages. The burden of proof is on the landlord to justify deductions. Failure to comply with the itemised statement and documentation requirements can forfeit the right to withhold. Tenants may recover in small claims court.