How to handle security deposits in Texas

Texas Property Code defines a “security deposit” as any advance of money other than a rental application deposit or an advance payment of rent. As such, this payment is intended to assure performance under a lease between a landlord and tenant for a dwelling. Security deposits are guaranteed for renters under the Texas Property Code.

Unfortunately, many tenants are unaware of this rule and cannot get an adequate refund for their deposit. According to the law, the landlord must restore the security deposit within 30 days of the renter leaving the premises. 

If the renter follows the lease contract and leaves the unit in good condition, with the exception of normal wear and tear, the security deposit is always refundable. That means that a tenant cannot disclaim their entitlement to a refund of the security deposit. 

Section 92.001(4) defines “normal wear and tear” as deterioration that arises from a dwelling’s intended use, including breakage or malfunction owing to age or deteriorated condition. 

However, this doesn’t include deterioration that results from negligence, carelessness, accident, or abuse of the premises or equipment by the tenant, a member of the tenant’s household, or a guest of the tenant. The landlord can keep a portion of the deposit, but only if the non-refundable component is referred to as a “redecorating fee” or a “make-ready fee.”  

Ultimately, it is crucial to maintain clear and open communication with your tenants or landlord about security deposits in order to prevent misunderstandings.