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interest on security deposits

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P

pmk7

Guest
What is the name of your state? Pennsylvania

In my new lease there is a clause that states that interest will be paid on security deposit if held more than three years. That is, if held for 4 years, interest will be paid for 1 year. My previous lease had no such language. I recently received a check from my old landlord for the amount of my old deposit, without any interest. My old deposit was held for 6 years. Is my new landlord being generous or is this law in PA? Am I legally owed 3 years interest on all funds held by my previous landlord?
 


JETX

Senior Member
Pennsylvania Code:
"68 Pa.S. Section 250.511b. INTEREST ON ESCROW FUNDS HELD MORE THAN TWO YEARS
(a) Except as otherwise provided in this section, all funds over one hundred dollars ($100) deposited with a lessor to secure the execution of a rental agreement on residential property in
accordance with section 511a and pursuant to any lease newly executed or reexecuted after the effective date of this act shall be deposited in an escrow account of an institution regulated by the Federal Reserve Board, the Federal Home Loan Bank Board, Comptroller of the Currency, or the Pennsylvania Department of Banking. When any funds are deposited in any escrow account,
interest-bearing or noninterest-bearing, the lessor shall thereupon notify in writing each of the tenants making any such deposit, giving the name and address of the banking institution in which such deposits are held, and the amount of such deposits.
(b) Whenever any money is required to be deposited in an interest-bearing escrow savings account, in accordance with section 511a, then the lessor shall be entitled to receive as
administrative expenses, a sum equivalent to one per cent per annum upon the security money so deposited, which shall be in lieu of all other administrative and custodial expenses. The balance of the interest paid shall be the money of the tenant making the deposit and will be paid to said tenant annually upon the anniversary date of the commencement of his lease.
(c) The provisions of this section shall apply only after the second anniversary of the deposit of escrow funds."
Source: http://www.mv.com/ipusers/nhpoa/padepo.htm

As I understand it, any tenancy of less than 2 years, the landlord keeps the full interest accrued on the deposit. Any tenancy of MORE than 2 years, the landlord must return the accrued interest to the tenant, but can hold 1.5% as an 'administration fee'.

Also, see:
http://www.grimlaw.com/custom1.htm
http://www.dms-lawyer.com/AREA/landlord.htm
http://www.nwls.org/security_deposits.htm
 

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