Montgomery County Security Deposit interest

Montgomery County Security Deposit interest

Tom HarkinsPro Member
Rental Property Investor · DC Area · Member since 2019 · 101 posts · 54 votes

Where do landlords in Montgomery County, MD keep your tenants' security deposits? I understand the county rule requiring paying 1.5% interest minimum. I also found the online calculator they provide. I'm asking if anyone has found a savings/CD/other account approaching that level of return, or if the expectation is that the interest comes (mostly) out of my pocket.

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Russell BrazilBusiness Member
Moderator
Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
6y

It needs to be deposited in an FDIC insured account in the state of Maryland and not comingled with personal funds. It is the landlords obligation to pay the interest dictated.

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  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    6y

    It needs to be deposited in an FDIC insured account in the state of Maryland and not comingled with personal funds. It is the landlords obligation to pay the interest dictated.

  • Vendor · Pasadena, MD · Member since 2016 · 43 posts · 24 votes
    6y

    @Tom Harkins there are a few deposit accounts out there that offer comparable rates, but I wouldn’t spend too much time looking for the best one. Many of my clients end up just paying interest differences out of pocket and deposit where it is convenient for them regardless of the interest rate. Get the best rate you can, but it’s far more important that you keep it separate, include all the necessary 8-203 info in your lease, and properly account for it at the end of the tenancy.

    The DHCD calculator (it that’s what you’re looking at) is great for deposits received after 1/1/2015-and a landlord is permitted to rely upon it per the MD RP Article.

  • Tom HarkinsPro Member
    OP
    Rental Property Investor · DC Area · Member since 2019 · 101 posts · 54 votes
    6y

    Thanks @James Gaither and @Russell Brazil. These responses are consistent with my understanding

  • Rental Property Investor · Brooke Park Drive · Member since 2018 · 1k+ posts · 2k+ votes
    6y

    You are talking about finding an account to recoup $27?

    $1800 rent x 1.5%

    You need to set your financial goals a little higher ma brotha

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