Law changes on renters' security deposit

Associated Press

Updated: Jul 9, 2011 2:02 PM

Connecticut landlords will no longer have to repay 1.5 percent minimum interest on renters' security deposits under a newly adopted law.

The change does not start until Jan. 1, 2012, but landlords' and tenants' groups are spreading the word so both sides are prepared.

Currently, Connecticut landlords must pay at least the average savings deposit rate to renters yearly on the money they hold for security deposits, but it cannot be less than 1.5 percent.

The new law eliminates that minimum, which property owners called unfair to landlords in the poor economy.

Legal assistance groups opposed the change, saying several banks have accounts that would pay the landlords at least 1.5 percent interest. State law requires landlords to keep tenants' security deposits separate so they are protected from landlords' creditors.

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