SECURITY DEPOSIT ITEMIZATION & DISPOSITION LETTER

(North Carolina Residential Tenancy)

[// GUIDANCE: This template is drafted to comply with North Carolina’s Tenant Security Deposit Act, N.C. Gen. Stat. §§ 42-50 – 42-56. Customize bracketed fields and delete all guidance notes prior to issuance.]

TABLE OF CONTENTS

I. Document Header
II. Definitions
III. Operative Provisions
IV. Representations & Warranties
V. Covenants & Restrictions
VI. Default & Remedies
VII. Risk Allocation
VIII. Dispute Resolution
IX. General Provisions
X. Execution Block

I. DOCUMENT HEADER

1.1 Title. Security Deposit Itemization & Disposition Letter (“Letter”).

1.2 Parties.
(a) Landlord: [LANDLORD LEGAL NAME], a [STATE] [ENTITY TYPE], with a principal address at [LANDLORD ADDRESS] (“Landlord”).
(b) Tenant: [TENANT LEGAL NAME(S)] with last-known forwarding address at [TENANT FORWARDING ADDRESS] (“Tenant”).

1.3 Effective Date. This Letter is effective as of [DATE MAILED] (“Effective Date”).

1.4 Governing Law. This Letter shall be governed by and construed in accordance with the laws of the State of North Carolina, excluding conflicts-of-law principles.

1.5 Recitals.
WHEREAS, Landlord and Tenant entered into that certain Residential Lease Agreement dated [LEASE DATE] concerning the premises located at [PREMISES ADDRESS] (“Lease”); and
WHEREAS, Tenant vacated and surrendered possession of the Premises on [MOVE-OUT DATE] (“Surrender Date”); and
WHEREAS, Landlord is required by N.C. Gen. Stat. § 42-52 to account for and, where applicable, return the Tenant Security Deposit;

NOW, THEREFORE, Landlord provides this Letter in compliance with applicable law.

II. DEFINITIONS

For purposes of this Letter, capitalized terms have the meanings set forth below:

“Accounting Deadline” means thirty (30) days after the Surrender Date, or sixty (60) days if an interim statement is provided pursuant to N.C. Gen. Stat. § 42-52(c).

“Permitted Deductions” means those charges expressly authorized by N.C. Gen. Stat. § 42-51, including but not limited to unpaid rent, damages in excess of ordinary wear and tear, and costs of re-renting following Tenant’s breach.

“Security Deposit” means the sum of [DEPOSIT AMOUNT] previously paid by Tenant and held in trust by Landlord pursuant to N.C. Gen. Stat. § 42-50.

III. OPERATIVE PROVISIONS

3.1 Deposit Held. Landlord has maintained the Security Deposit in a separate trust account at [FINANCIAL INSTITUTION], account no. [LAST 4 DIGITS].

3.2 Itemization of Deductions. Pursuant to N.C. Gen. Stat. § 42-52, Landlord hereby provides a complete, itemized statement of Permitted Deductions:

[// GUIDANCE: Attach invoices, photographs, or repair estimates as Exhibits A-__, cross-referencing the table numbers.]

3.3 Disposition of Deposit.
(a) Deposit Balance: $[DEPOSIT AMOUNT]
(b) Less Total Permitted Deductions: – $[ ]
(c) Amount Owed to Tenant: $[REMAINING BALANCE] (to be remitted by [CHECK/ELECTRONIC TRANSFER] concurrently with this Letter)
(d) Amount Owed by Tenant (if deductions exceed deposit): $[TENANT BALANCE] due within ten (10) business days of Tenant’s receipt of this Letter.

3.4 Interim Statement (if applicable). [INCLUDE ONLY IF 30-DAY STATEMENT IS INTERIM] Landlord’s investigation of damages is ongoing. A final accounting shall be provided no later than sixty (60) days after the Surrender Date in accordance with N.C. Gen. Stat. § 42-52(c).

IV. REPRESENTATIONS & WARRANTIES

4.1 Landlord’s Representations. Landlord represents that:
(a) all deductions identified herein are Permitted Deductions;
(b) supporting documentation attached hereto is true and correct to the best of Landlord’s knowledge; and
(c) this Letter is timely delivered in compliance with the Accounting Deadline.

4.2 Survival. The representations set forth in Section 4.1 survive delivery of this Letter.

V. COVENANTS & RESTRICTIONS

5.1 Tenant Cooperation. Tenant shall promptly furnish any additional forwarding address in writing to Landlord.

5.2 Mitigation. Landlord covenants to exercise commercially reasonable efforts to mitigate damages in accordance with applicable law.

VI. DEFAULT & REMEDIES

6.1 Tenant Default. Failure by Tenant to remit any outstanding balance identified in Section 3.3(d) within the stated period constitutes a default under the Lease and this Letter.

6.2 Remedies. Upon default, Landlord may pursue all remedies available at law or in equity, including recovery of reasonable attorneys’ fees and court costs as provided in N.C. Gen. Stat. § 42-46(h).

VII. RISK ALLOCATION

7.1 Liability Caps. Landlord’s liability for statutory penalties, if any, is limited to those expressly set forth in the Tenant Security Deposit Act.

7.2 No Indemnification. Consistent with the Metadata, no indemnification obligations are created by this Letter.

VIII. DISPUTE RESOLUTION

8.1 Forum Selection. Any action arising out of or relating to this Letter shall be filed exclusively in the [COUNTY] County Housing Court of North Carolina.

8.2 Arbitration. Arbitration is expressly excluded.

8.3 Jury Trial. Nothing herein shall be construed as a waiver of either party’s constitutional right to trial by jury.

IX. GENERAL PROVISIONS

9.1 Amendments. This Letter may be amended only by a written instrument signed by both parties.

9.2 Entire Agreement. This Letter, together with the Lease and its amendments, constitutes the entire agreement concerning the Security Deposit.

9.3 Severability. If any provision of this Letter is held unenforceable, the remaining provisions shall remain in full force.

9.4 Successors & Assigns. This Letter binds and benefits the parties and their respective heirs, successors, and assigns.

9.5 Counterparts; Electronic Signatures. This Letter may be executed in counterparts and delivered via electronic transmission, each of which shall be deemed an original.

X. EXECUTION BLOCK

IN WITNESS WHEREOF, the undersigned have executed this Security Deposit Itemization & Disposition Letter as of the Effective Date.

[// GUIDANCE: Notarization is not required for a security deposit accounting letter under NC law, but attach a certificate of service or certified mailing receipt for evidentiary purposes.]

CERTIFICATE OF SERVICE (optional)

I, [NAME], certify that a true and correct copy of this Letter, together with all referenced enclosures, was sent to Tenant via [USPS Certified Mail / FedEx Overnight / Email + PDF] to the forwarding address stated above on [DATE].

[NAME & TITLE]

[// GUIDANCE: Retain copies of this Letter and all supporting documentation for a minimum of three (3) years to defend against potential claims under N.C. Gen. Stat. §§ 42-52 & 42-55.]