Nonrefundable Deposits and Fees: What's Legal and What's Not

A landlord cannot make any part of a security deposit nonrefundable in California, Massachusetts, New York, or Washington, and in Texas, money held to secure the lease is a refundable deposit whatever the lease calls it. States differ on separate nonrefundable fees. California counts nearly every upfront charge, including pet, cleaning, and key fees, as part of the refundable deposit, Massachusetts allows only first and last month's rent, a deposit, and the cost of a new lock, and Washington allows a nonrefundable fee only when the written lease clearly says it is nonrefundable.

Can any part of a security deposit be nonrefundable?

No, in the five states covered here. A security deposit is money the landlord holds in case you leave owing rent or leave damage beyond normal wear and tear, and each of these laws requires the landlord to return whatever it does not lawfully use:

• California: a lease cannot call any part of the deposit "nonrefundable."
• New York: the entire deposit is refundable, minus reasonable, itemized costs for unpaid rent, damage beyond normal wear and tear, utility charges owed to the landlord, and moving and storing belongings you leave behind.
• Washington: money that is nonrefundable cannot be called a deposit or part of one.
• Massachusetts: the landlord can deduct only unpaid rent or water charges, unpaid real estate tax increases you owe under the lease, and a reasonable amount to repair damage caused by you or your guests, excluding reasonable wear and tear.
• Texas: the landlord can deduct only damages and charges you owe under the lease and can never keep deposit money for normal wear and tear.

A clause that calls $300 of the deposit nonrefundable, or a "nonrefundable cleaning deposit," does not change those rules. Our guide to illegal lease clauses explains what happens to lease terms that conflict with state law.

Which upfront fees can a landlord charge?

Details that change what you pay:

• California: a small landlord is an individual, or an LLC owned only by individuals, that owns no more than two rental properties with no more than four units in total. The two-month limit does not apply if you are a service member. The screening fee is separate from the deposit and cannot exceed the landlord's actual screening costs, including the reasonable value of its time, up to $30 per applicant plus inflation adjustments since 1998. The landlord can charge it only if it either reviews completed applications in the order received, approves the first qualified applicant, and charges only applicants it actually considers, or refunds the whole fee to every applicant it does not select within 7 days after picking a tenant or 30 days after you applied, whichever comes first.
• Massachusetts: since August 1, 2025, the limit also covers payments to the landlord's agent, so a broker who works for the landlord cannot require you to pay a fee.
• New York: the check fee is waived if you give the landlord a background or credit check done within the past 30 days, and the landlord must give you a copy of the check and the receipt before collecting the fee.
• Washington: a holding fee is money paid to hold a unit for you after the landlord offers it. The landlord must give you a receipt and a written statement of when it can keep the fee, and if you move in, the fee is credited to your first month's rent or your deposit. Seattle sets tighter limits: nonrefundable fees are allowed only for screening and cleaning and are capped at 10% of one month's rent (screening costs above that are allowed if they match standard Seattle costs), the deposit and fees together cannot exceed one month's rent, and on a lease of six months or more you can pay them in six monthly installments.

Pet charges and cleaning fees have their own rules, covered in our guides to pet deposits and pet fees and cleaning deductions. For how one-time move-in fees compare with deposits in a lease, see move-in fees vs. security deposits. Our overview of state security deposit laws explains how deposit limits and return deadlines vary by state.

How to tell whether a "fee" is really a deposit

These laws look at what a payment is for, not what the lease calls it. Three questions sort most charges:

1. Does it cover something you might do later? In California, a charge for damage, move-out cleaning, or rent you might not pay is security, so it is refundable and counts toward the cap whatever the lease calls it. Texas defines a security deposit as money, other than an application deposit or advance rent, "intended primarily to secure performance under a lease," so a one-time fee described as covering future damage fits that definition. The Texas exception is a monthly fee paid instead of a deposit: it is not refundable if you sign a written agreement and the landlord uses the fee to buy insurance covering damage and unpaid rent you owe, but the landlord must also offer you a regular deposit, and you still owe for damage beyond normal wear and tear. Washington, by contrast, allows a nonrefundable cleaning fee if the lease says so (question 3).
2. Does it pay for something done now? A credit check or a new lock is a cost the landlord has before you move in. Those are the only kinds of upfront fees New York and Massachusetts allow.
3. Does the written lease call it nonrefundable? In Washington, a fee the written lease does not clearly call nonrefundable is a refundable deposit. If there is no written lease, the landlord owes you back any nonrefundable fees it collected.

California example: your rent is $2,400 and the landlord is not a small landlord. The lease asks for a $2,400 deposit, a $350 nonrefundable cleaning fee, and a $100 key fee. All three count as security, so the total is $2,850 ($2,400 + $350 + $100), which is $450 over the $2,400 cap. The $450 excess is money the landlord had no right to collect, and at move-out the rest must be refunded minus lawful deductions. Our guide to how much a landlord can charge for a security deposit covers how to recover an amount above a cap.

What to do about a fee you think is illegal

1. Ask before you sign. Ask the landlord in writing to list each charge, what it pays for, and whether it is refundable.
2. Ask to remove or convert it. Request that the fee be dropped or treated as part of the refundable deposit, and name the law from the table above.
3. Get an itemized receipt. Pay by a traceable method and keep a receipt that names each charge.
4. In Washington, ask for installments. Send a written request to pay deposits and nonrefundable fees over time: three equal monthly payments for a lease of three months or longer, or two in other cases, such as a month-to-month rental (Seattle's longer schedule is described above). Holding fees do not count toward this right. The landlord can refuse only if deposits and fees total no more than 25% of the first month's rent and no last month's rent is due up front, and a landlord who refuses a valid request owes you one month's rent plus attorney fees.
5. Claim it at move-out. Include the fee in your written demand for the deposit. If the landlord keeps it, you can sue in small claims court, and in California a court can add up to twice the amount of the deposit if the landlord kept the money in bad faith, on top of your actual damages.