Security deposits in Virginia are regulated by Virginia Code § 55.1-1200 to § 55.1-1206. Certain municipalities may have local laws that supplement state regulations. To ensure full compliance, verify the regulations applicable in your area.

KEY POINTS AT A GLANCE: Virginia

Deposit Cap: 2x Monthly Rent

Holding Requirements: No

Interest Required: No

Return Window: 45 days

COLLECTION & HOLDING REQUIREMENTS

Deposit Cap: Virginia state law limits security deposits to two months’ rent. Landlords/property managers may alternatively procure damage insurance and require the tenant to pay the premium instead of a security deposit. The premium paid by the tenant, however, cannot be more than two months’ rent.

Holding Requirements: Virginia state law does not currently require security deposits to be held in a bank account within the state, in a separate account, or in an interest-bearing account.

Information Provided to Tenant: Virginia state law does not currently require landlords/property managers to disclose where the security deposit is held.

Interest on Deposits: Virginia state law does not currently require landlords/property managers to pay interest to tenants on security deposits.

RETURN

Joint Inspection: Within 5 days of a tenant providing notice to vacate the rental unit, the landlord/property manager must provide written notice of the tenant’s right to a joint inspection of the premises. If the tenant wants to be present for the inspection, they shall tell the landlord/property manager in writing, who in turn must notify the tenant of the date and time of the inspection within 72 hours of the tenant vacating the premises. Following the inspection, the landlord/property manager must provide the tenant with a written security deposit disposition statement that includes an itemized list of damages.

Timeline: Within 45 days of vacancy, the landlord/property manager must either (1) return the full security deposit to the tenant or (2) provide the tenant with a written itemized notice of any deductions to the security deposit, together with the portion of the security deposit being returned. If the landlord/property manager intends to withhold a portion of the security deposit to cover an unpaid utility bill that the tenant was required to pay, the landlord/property manager must advise the tenant of their intent in (1) a termination notice, (2) a written notice confirming the date that the tenant will vacate the rental unit, or (3) a separate written notice to the tenant at least 15 days before the deduction to the security deposit. The landlord/property manager must also provide written confirmation to the tenant within 10 days of paying the utility bill. 

Documentation of Deductions: The written notice of deductions must itemize and explain the reason for each deduction from the security deposit.

Permissible Deductions: Landlords/property managers may deduct the following from security deposit funds:

• Unpaid rent or utilities
• Damages beyond normal wear and tear
• Other charges due under the lease, such as an administrative fee for expedited processing of a security deposit return, so long as the tenant requests expedited processing in writing

‍Penalties: Failure to return the security deposit or provide the written itemized notice of deductions as required may result in the landlord/property manager being liable for the full amount of the security deposit, actual damages, and attorney’s fees and court costs if the tenant wins in a lawsuit.

SALE OF THE RENTAL PROPERTY

If the property is sold, the landlord/property manager must transfer the security deposit to the new owner at the time of the sale.