What is the maximum security deposit in Maryland?

One month's rent per dwelling unit, or up to two months in a narrow utility assistance case where both sides agree in writing (RP 8-203(b)).

How long does a Maryland landlord have to return a deposit?

45 days after the tenancy ends, with simple interest and less damages rightfully withheld, plus a written damages list with an itemized statement if anything is kept.

How much interest does a Maryland landlord owe?

Simple interest at the greater of the one year Treasury yield curve rate on the first business day of the year or 1.5 percent, only if the deposit was held at least six months.

What is the penalty for wrongly keeping a Maryland deposit?

Up to three times the amount withheld plus attorney fees when there is no reasonable basis.

Maryland Security Deposit Laws for Landlords

Maryland caps a security deposit at one month's rent, requires it to sit in an insured Maryland account that earns interest, and gives you 45 days after the tenancy ends to return it with simple interest and a damages list. A landlord without a reasonable basis for keeping money can owe up to three times the amount withheld, and one who charges above the cap can owe up to three times the extra. It is all in Real Property section 8-203.

What is the cap and what happens if I exceed it?

Under 8-203(b), a landlord may not impose a deposit above the equivalent of one month's rent per dwelling unit, regardless of the number of tenants. The definition covers any payment of money, including the last month's rent paid in advance, given to protect the landlord against unpaid rent or damage. One exception allows up to two months where the tenant qualified for utility assistance through the Department of Human Services, the lease has the tenant pay utilities directly to the landlord, and both sides agree in writing to the amount.

If you break the cap, the tenant may recover up to three times the extra amount charged, plus reasonable attorney fees, and may bring the action during the tenancy or within two years after it ends.

Example a made-up unit rents for $1,800. Taking a $2,400 deposit is $600 over the cap. The tenant can recover up to three times that, $1,800, plus attorney fees. The same landlord who took $1,800 would have had no exposure.

Where must the deposit be held?

Subsection (d) requires federally insured financial institutions doing business in Maryland. The accounts must be at Maryland branches, devoted exclusively to security deposits, and interest bearing, and the deposit must go into an account within 30 days of receipt. The accounts together must equal all the deposits you owe. Insured certificates of deposit at Maryland branches, or federal or Maryland securities, can replace the accounts. The deposit cannot be attached by your creditors or the tenant's. After a sale, you stay liable for any portion you fail to hand to the buyer with an accounting, and the successor is liable to the tenant too.

The receipt rules, including what the lease must say, are covered in our post on Maryland deposit receipt rules.

How do I figure the interest?

Subsection (e) sets simple interest at the daily U.S. Treasury yield curve rate for one year on the first business day of each year, or 1.5 percent a year, whichever is greater. It accrues in monthly intervals from the day the tenant gives you the deposit and is not compounded. No interest is due unless you held the deposit at least six months, and none for a period shorter than a full month, and it is payable only on deposits of $50 or more. The Department of Housing and Community Development must publish the yearly rates or a calculator, and a landlord may rely on them (subsections (m) and (n)).

Example a made-up $1,800 deposit is held 24 full months. If the greater of the Treasury rate or 1.5 percent for each year was 1.5 percent, the interest is 1.5 percent of $1,800 a year, $27, for two years: $54. A tenant who leaves after only 5 months is owed none.

What are the 45 days and the damages list?

Within 45 days after the end of the tenancy you return the deposit with interest, less damages rightfully withheld (e)(1). If you keep any part, you mail by first-class mail to the tenant's last known address, within the same 45 days, a written list of the damages claimed with an itemized statement of the cost, and supporting documentation that identifies the materials or services (g) and (j). An estimate can do as documentation, but then you must tell the tenant in writing when the repairs are finished, send the final invoice, and refund within 30 days any amount that exceeded the actual cost (j) and (k). Miss the list and you forfeit the right to withhold anything for damages (g)(2).

You may withhold for unpaid rent, damage due to breach of the lease, or damage by the tenant or the tenant's family, agents, employees, guests or invitees in excess of ordinary wear and tear, to the unit, common areas, major appliances and furnishings you own. The deposit is not liquidated damages (f).

When does the tenant get to attend an inspection?

A tenant who sends certified mail at least 15 days before moving, stating the intent to move, the moving date and the new address, has the right to be present at your inspection. You reply by certified mail with the time and date, within five days before or after the moving date. The tenant must be told of this right in writing when the deposit is paid. If you fail to comply, you forfeit the right to withhold any part of the deposit for damages (f)(1).

What if I keep money without a reasonable basis?

Under (e)(4), if you, without a reasonable basis, fail to return any part of the deposit plus accrued interest within 45 days, the tenant has an action for up to three times the withheld amount plus reasonable attorney fees. Tenants who were evicted or abandoned the premises can demand the deposit by first-class mail within 45 days, and you then have 45 days from that notice to answer (h). Waivers in a lease are not allowed (l).

Example a made-up landlord keeps $500 of a $1,800 deposit with no list and no basis. The tenant can seek up to $1,500, three times the amount withheld, plus attorney fees, in addition to getting the money back.

Can a tenant use a surety bond instead?

Subsection (i) lets a tenant buy a surety bond in place of all or part of a deposit, but you do not have to consent and you may not require one. A bond may not exceed two months' rent, alone or combined with a deposit. Before a claim you send the tenant a list of damages at least 10 days ahead, and the tenant may pay you directly or require you to use any deposit first.

How DoorKeeping handles it

In DoorKeeping a deposit sits on its own line for each tenant in the property's own books, along with the date it was received, which is the starting date for the interest count. Leases are e-signed, and the damage list and invoices can be filed with the property's documents. Deposits stay in your own bank account: DoorKeeping never holds your money and sends a payment only when you approve it. It gives no legal advice.

Sources

Maryland Code, Real Property, section 8-203, security deposits, read Oct 30, 2026

Questions

What is the maximum security deposit in Maryland?: One month's rent per dwelling unit, or up to two months in a narrow utility assistance case where both sides agree in writing (RP 8-203(b)).
How long does a Maryland landlord have to return a deposit?: 45 days after the tenancy ends, with simple interest and less damages rightfully withheld, plus a written damages list with an itemized statement if anything is kept.
How much interest does a Maryland landlord owe?: Simple interest at the greater of the one year Treasury yield curve rate on the first business day of the year or 1.5 percent, only if the deposit was held at least six months.
What is the penalty for wrongly keeping a Maryland deposit?: Up to three times the amount withheld plus attorney fees when there is no reasonable basis.