Almost every residential lease agreement stipulates that the tenant must provide the landlord with security for the fulfillment of his obligations. There is a need to protect the landlord, especially with regard to rent and utility arrears and damage to the rented property. Such a rent deposit is considered standard and is therefore often perceived as a less important ancillary clause. However, it is worthwhile for both parties to a rental agreement to pay attention to the deposit agreement.
The landlord's right to demand a deposit from the tenant is not already established by law. Rather, a rent deposit must be contractually agreed. However, there are some legal regulations, the disregard of which can lead to the ineffectiveness of such deposit agreements.
For example, the amount of the deposit for a residential rental may not exceed three times the net monthly rent (excluding utilities). If a sum of money is provided as a deposit, the tenant is entitled to interest on it. The interest increases the deposit.
The tenant is authorized to pay a sum of money to be provided as a deposit to the landlord in three equal monthly installments. The first installment is due upon moving in, and the other two installments are each due one month later. If the contract stipulates immediate payment of the deposit without reference to the tenant's right to pay in installments, the entire deposit agreement is invalid. This means that the tenant does not owe any deposit at all and can demand the immediate return of any deposit that may have already been paid.
The same drastic consequence threatens if the lease agreement stipulates that the deposit is due upon the conclusion of the lease agreement. This is because the tenant does not owe the deposit until he moves in. Any agreement to the contrary that is to his disadvantage is invalid.
The requirements for the deposit arrangement are even stricter for rental agreements for price-controlled housing. In these cases, the deposit agreement must make it clear that the deposit only provides the landlord with security for damage to the rented property and for failure to carry out cosmetic repairs. Unlike in the free housing market, in these cases the landlord may not use the deposit to settle outstanding claims for utility and incidental costs and, in particular, may not use it to settle outstanding rent. This is because these risks have already been taken into account in the calculation of the so-called cost rent, which is charged in these cases. The landlord may not secure them again separately. If the purpose of the security is not limited to damage to the rented property and outstanding cosmetic repairs, the landlord also runs the risk here of not being able to demand any security deposit from the tenant at all due to the ineffectiveness of the security deposit agreement as a whole.
The conclusion is that
Not only the tenant should read a deposit agreement carefully in order to be able to defend himself against any unfair disadvantages. Rather, the landlord must also check whether the deposit agreement complies with the relevant legal provisions if he does not want to run the risk of having no deposit claim at all due to a violation of these provisions. Both sides should therefore attach importance to the careful formulation of a security deposit agreement.
The statements represent initial information that was current for the law applicable in Germany at the time of initial publication. The legal situation may have changed since then. Furthermore, the information provided cannot replace individual advice on a specific matter. Please contact us for this purpose.