New York Security Deposit Interest Rules
New York requires an interest-bearing account for security deposits in buildings with 6+ units (N.Y. Gen. Oblig. Law § 7-103). Free calculator.
New York Security Deposit Interest Rules
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Book a DemoDoes New York require interest on security deposits?
Only in buildings with 6 or more units. Under N.Y. Gen. Oblig. Law § 7-103, the landlord of such a building must place the deposit in an interest-bearing account at the prevailing rate paid by banks in the area. The statute sets no fixed percentage rate.
The administrative fee
The landlord may keep an administrative fee of 1 percent per year on the deposit. The remaining interest belongs to the tenant.
Holding the deposit and notice to the tenant
Under § 7-103, a security deposit is held in trust and may not be commingled with the landlord's own money. The landlord must give the tenant notice of the name and address of the bank holding the deposit and the amount of the deposit. A lease provision that waives these rights is void.
Other New York rules
This page covers only § 7-103. Other New York rules, including those for rent-regulated housing and New York City, may add requirements that are not summarized here.
How to use this calculator
Enter the deposit amount and how many months it has been held. The calculator does not compute a dollar amount for New York, because the interest depends on the prevailing rate paid by banks in the area. Use it to see the rule summary and to check whether your building (6 or more units) is covered.
Frequently asked questions about New York deposit interest
Does New York require landlords to pay interest on security deposits?
Only in buildings with 6 or more units. Under N.Y. Gen. Oblig. Law § 7-103, the landlord of such a building must place the deposit in an interest-bearing account at the prevailing rate paid by banks in the area. The landlord may keep a 1 percent annual administrative fee.
What is the interest rate on New York security deposits?
There is no fixed statutory rate. The statute refers to the prevailing rate paid by banks in the area, and the landlord may keep an administrative fee of 1 percent per year.
Can a New York landlord mix the deposit with their own money?
No. Under § 7-103, a security deposit is held in trust and may not be commingled with the landlord's own money.
What notice must a New York landlord give about the deposit?
The landlord must give the tenant notice of the name and address of the bank holding the deposit and the amount of the deposit.
Can a New York tenant waive these deposit protections?
No. Under § 7-103, a provision in a lease or agreement that waives these rights is void.
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