Security Deposit Interest
Calculator
Results
- Interest owed to the tenant
- 112.5
- Interest per year
- 37.5
- Total to return to the tenant
- 1,612.5
Property management results
| Interest owed to the tenant | 112.5 |
| Interest per year | 37.5 |
| Total to return to the tenant | 1,612.5 |
formula-map diagram
- Interest owed to the tenant
- 112.5
- Interest per year
- 37.5
- Total to return to the tenant
- 1,612.5
Property management relationship
Formula
Interest = deposit × annual rate ÷ 100 × years held= 112.5
Note
This is a simplified model: it applies the standard property-management definition to the numbers you entered. Rent affordability uses a flat share-of-income rule and ignores credit history, local screening criteria and household size. Proration assumes a plain daily rate; your lease or local law may prescribe a different convention (for example a fixed 30-day month). Security-deposit interest is simple interest at the rate you enter, while many jurisdictions set the rate, the compounding and the payout schedule by statute. Income, expense, reserve and escalation figures are straight-line and assume the amounts you enter hold steady; they ignore taxes, depreciation, financing changes, capital events, inflation and market turnover. Lease buyout compares the contractual penalty with the remaining rent only and is not a reading of your lease. These results are general information, not legal, tax or investment advice: check your lease and local tenancy law and consult a qualified professional before acting.
More in Property management
See all →Frequently asked questions
Why would a landlord owe interest on a security deposit?+
Many jurisdictions legally require landlords to pay tenants interest on held security deposits, especially for longer tenancies, on the reasoning that the landlord is holding the tenant's money and earning use of it during that time — the specific rate and whether it's required at all varies significantly by location.
How is the interest typically calculated?+
It's usually simple interest calculated as deposit amount x interest rate x time held (often expressed in years or fraction of a year), though a few jurisdictions require compounding — check local rules since the calculation method isn't universal.
Where does the interest rate come from?+
It's typically set by local law or regulation (sometimes tied to a benchmark rate that changes annually), not chosen by the landlord or tenant, so you need to look up the legally mandated rate for your specific jurisdiction and year rather than assume a fixed percentage.
Does the landlord have to pay the interest every year or only at move-out?+
This also varies by jurisdiction — some require annual interest payments or credits to the tenant, while others only require the accumulated interest to be paid out when the deposit itself is returned at the end of the tenancy.
What happens if a landlord doesn't pay required deposit interest?+
In jurisdictions that mandate it, failing to pay can expose the landlord to penalties, and in some places the tenant can claim the missing interest (sometimes with a multiplier) through a tenancy dispute process — it's worth confirming your local rules rather than assuming no consequence applies.