Security Deposit Return Deadlines & Deductions in North Dakota
At a glance
| Governing law | N.D.C.C. § 47-16-07.1 (Real property and dwelling security deposits — Limitations and requirements) |
|---|---|
| Deadline to return the deposit | 30 days after BOTH the termination of the lease AND the tenant's delivery of possession — a conjunctive two-part trigger, not either event alone |
| Itemized statement required? | Yes — any portion of the deposit not returned must be itemized by the landlord, delivered or mailed to the tenant's last furnished address along with a written notice, within the same 30-day window; the notice must state either the amount still due the landlord or the refund due the tenant |
| What can be deducted | Damages the landlord suffered from deterioration or injury to the property caused by the tenant's pet or the tenant's (or the tenant's guest's) negligence; unpaid rent; and the costs of cleaning or other repairs needed to return the dwelling to its original condition, reasonable wear and tear excepted |
| Maximum deposit amount | One month's rent generally. Two exceptions raise the ceiling to two months' rent: (1) a landlord MAY accept up to two months' rent as an incentive to rent to an individual with a felony conviction; (2) a landlord MAY demand up to two months' rent from an individual with a prior judgment against them for violating a previous rental agreement. A separate pet deposit (for a non-service, non-companion animal) is capped at the greater of $2,500 or two months' rent. |
| Interest on the deposit? | Yes — the deposit must sit in a federally insured interest-bearing account, and the deposit plus any accrued interest must be paid to the tenant at lease termination. Exception: no interest is required if the tenant's occupancy lasted less than nine months. |
| Penalty for a late/bad-faith withholding | The landlord is liable for TREBLE damages for any security deposit money withheld without reasonable justification — a 3x multiplier tied to an unjustified-withholding standard, not a flat forfeiture-on-missed-deadline rule |
| Separate account or bond required? | Yes — the deposit must be held in a federally insured interest-bearing savings or checking account for the tenant's benefit; on a sale of the property, the deposit and accrued interest transfer to the new owner, and the seller isn't released from liability until that transfer actually happens |
Requirements one by one
Governing law
North Dakota's deposit rules live in one section, N.D.C.C. § 47-16-07.1, inside the state's general leasing-of-real-property chapter.
Deadline to return the deposit
The itemization and payment must be "delivered or mailed to the lessee at the last address furnished lessor, along with a written notice within thirty days after termination of the lease and delivery of possession by the lessee" (§ 47-16-07.1(3)) — both the lease ending and possession being handed back have to occur before the 30 days start.
Itemized statement required?
Yes. "Application of any portion of a security deposit not paid to the lessee upon termination of the lease must be itemized by the lessor," delivered with "a written notice" stating "any amount still due the lessor or the refund due the lessee" (§ 47-16-07.1(3)).
What can be deducted
"Any damages the lessor has suffered by reason of deteriorations or injuries to the real property or dwelling by the lessee's pet or through the negligence of the lessee or the lessee's guest"; "any unpaid rent"; and "the costs of cleaning or other repairs which were the responsibility of the lessee... necessary to return the dwelling unit to its original state when the lessee took possession, reasonable wear and tear excepted" (§ 47-16-07.1(3)).
Maximum deposit amount
"A lessor may not demand or receive security, however denominated, in an amount or value in excess of one month's rent" (§ 47-16-07.1(1)), with two named exceptions: up to two months' rent as an incentive to rent to "an individual convicted of a felony offense," and up to two months' rent demanded from "an individual who has had a judgment entered against that individual for violating the terms of a previous rental agreement." A separate pet deposit is capped at "the greater of two thousand five hundred dollars or an amount equivalent to two months' rent" (§ 47-16-07.1(2)).
Interest on the deposit?
Yes, with one exception. The deposit must sit in "a federally insured interest-bearing savings or checking account for the benefit of the tenant," and "the security deposit and any interest accruing on the deposit must be paid to the lessee upon termination of a lease" (§ 47-16-07.1(1)). But "a lessor is not required to pay interest on security deposits if the period of occupancy was less than nine months in duration" (§ 47-16-07.1(3)).
Penalty for a late/bad-faith withholding
"A lessor is liable for treble damages for any security deposit money withheld without reasonable justification" (§ 47-16-07.1(4)) — three times the wrongfully withheld amount, tied to whether the withholding lacked reasonable justification rather than a bare missed-deadline trigger.
Separate account or bond required?
Yes. The deposit must be held in "a federally insured interest-bearing savings or checking account for the benefit of the tenant" (§ 47-16- 07.1(1)). If the property is sold, "the security deposit and accrued interest shall be transferred to the grantee," and "the grantor shall not be relieved of liability... until transfer of the security deposit to the grantee" (§ 47-16-07.1(5)).
What trips people up
The 30-day clock needs BOTH the lease ending and possession being handed back. If you leave belongings behind or don't formally surrender possession, the deadline may not have started yet.
Interest isn't automatic — it depends on how long you lived there. Stay under nine months, and the landlord owes no interest at all, even though the deposit still has to sit in an interest-bearing account.
Two deposit-cap exceptions cut in opposite directions but land on the same number. A felony conviction lets a landlord voluntarily accept a bigger deposit as an incentive to rent to you; a past rental-agreement judgment lets a landlord demand one. Both cap out at two months' rent, but they're triggered by very different facts.
Unclaimed refunds don't just vanish. If you don't collect a refund within a year of the lease ending, the money becomes subject to the state's unclaimed-property reporting rules rather than being kept by the landlord.
Common questions
How long does my North Dakota landlord have to return my deposit? 30 days after both your lease ends and you hand back possession.
Is there a cap on my deposit? One month's rent ordinarily, with limited exceptions letting it reach two months' rent (a felony-conviction incentive, or a past rental-judgment surcharge), plus a separate pet deposit up to the greater of $2,500 or two months' rent.
Do I get interest on my deposit? Yes, if you lived there nine months or longer. Under nine months, no interest is owed even though the money still has to sit in an interest-bearing account.
Statutes and sources
- N.D.C.C. ch. 47-16 — Leasing of Real Property, the chapter containing the security-deposit section. https://ndlegis.gov/cencode/t47c16.pdf (accessed 2026-08-13)
- N.D.C.C. § 47-16-07.1(1) — the deposit cap, its felony-incentive and past-judgment exceptions, and the interest-bearing-account requirement. https://ndlegis.gov/cencode/t47c16.pdf (accessed 2026-08-13)
- N.D.C.C. § 47-16-07.1(2) — the separate pet security deposit cap. https://ndlegis.gov/cencode/t47c16.pdf (accessed 2026-08-13)
- N.D.C.C. § 47-16-07.1(3) — permitted deductions, the 30-day itemization deadline, and the 9-month interest exception. https://ndlegis.gov/cencode/t47c16.pdf (accessed 2026-08-13)
- N.D.C.C. § 47-16-07.1(4) — the treble-damages penalty. https://ndlegis.gov/cencode/t47c16.pdf (accessed 2026-08-13)
- N.D.C.C. § 47-16-07.1(5) — the deposit's transfer on a sale of the property. https://ndlegis.gov/cencode/t47c16.pdf (accessed 2026-08-13)
Source links
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