Phil Querin Q&A: Security Deposits and Prepaid Rent

Want access to MHCO content?

For complete access to forms, conference presentations, community updates and MHCO columns, log in to your account or register.

June 6, 2016
Phil Querin
MHCO Legal Counsel
Querin Law


Question. What type of fees and deposits am I allowed to require of new residents when they move into the community?



Answer. Here is a summary of what you can and cannot do. The statute is found at ORS 90.300.

  • A “security deposit” includes any last month’s rent deposit;
  • You must provide the tenant with a receipt for any security deposit the tenant pays;
  • If you sell the park you need to turn over all deposits to the new owner, since he/she then has the responsibility to return the deposit at the end of the tenancy;
  • The rental agreement must identify the deposit(s) and amounts;
  • You may not increase a security deposit during the first year of the tenancy (if it’s increased after the first year, the tenant must be given three months to pay);
  • However, if you and the tenant agree to modify the rental agreement, say for a pet, then you may increase the deposit;
  • You may claim from the security deposit only the amount reasonably necessary:
    •  To remedy the tenant’s defaults in the performance of the rental agreement including, but not limited to, unpaid rent; and
    •  To repair damages to the premises caused by the tenant, not including ordinary wear and tear.
  • You are landlord not required to repair damage caused by the tenant in order to claim the deposit for the cost to make the repair. Any labor costs assessed for cleaning or repairs must be based on a reasonable hourly rate. You may charge a reasonable hourly rate for you own time if you do the cleaning or repair work;
  • The type of defaults and damages for which you charge the security deposit include (but are not limited to):
    • Carpet cleaning, other than the use of a common vacuum cleaner, if the cleaning is performed by use of a machine specifically designed for cleaning or shampooing carpets;
    • There are several other carpet cleaning provisions (check the statute);
    • Loss of use of the dwelling unit during the performance of necessary cleaning or repairs for which the tenant is responsible if the cleaning or repairs are performed in a timely manner.
  • You may not require a tenant to pay or forfeit a security deposit or prepaid rent for the tenant’s failure to maintain a tenancy for a minimum number of months in a month-to-month tenancy;
  • You must apply any last month’s rent deposit to the rent due for the last month of the tenancy:
    • When you or the tenant gives to the other a notice of termination, other than a notice of termination under ORS 90.394 (failure to pay rent);
    • When you and the tenant agree to terminate the tenancy; or
    •  When the tenancy terminates in accordance with the provisions of a written rental agreement for a fixed term tenancy.
  •  You must account for and refund any portion of a last month’s rent deposit;
  • Unless you and the tenant agree otherwise, the tenant may not require you to apply a last month’s rent deposit to rent due for any period other than the last month of the tenancy;
  • In order to claim all or part of any prepaid rent or security deposit, within 31 days after the tenancy terminates and the tenant returns possession you must give the tenant a written accounting that states specifically the basis of the claim(s) against the deposit;
  • You must give a separate accounting for security deposits and for prepaid rent;
  • You must return the unclaimed deposit or prepaid rent not later than 31 days after the tenancy terminates and the tenant returns possession to you;
  • The written accounting and refund of unused deposit or prepaid rent to be by personal delivery or by first class mail;
  • For situations in parks where the tenant has abandoned the home (or floating homes in marinas), the 31-day accounting and return period commences on the earliest of:
    •  Waiver of the abandoned property process;
    •  Removal of the manufactured dwelling (or floating home) from the rented space;
    •  Destruction or other disposition of the manufactured dwelling or floating home; or
    • Sale of the manufactured dwelling or floating home.
  • If you fail to comply with the accounting and return provisions of the statute or it is in bad faith (e.g. improper charges, etc.), the tenant may recover the money due in an amount equal to twice the amount:
    • Withheld without a written accounting; or
    • Withheld in bad faith.
  • Claims arising under the security deposit statute do not preclude you or the tenant from recovering other damages under the Landlord Tenant Act.
Column Topics: 
Location Tags: