Lease clauses and deposit mistakes that cost owners double

Greymill AcademyUS6 min readReviewed Oct 202637 primary sourcesUK version

The short answer

Some common lease clauses are void, and getting a security deposit wrong at move-out can cost two or three times the amount.

The takeaway. Use your state's deposit cap, holding rules and return deadline, itemize deductions with evidence, and strike any lease clause the state makes void before you sign.

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Written for landlords, property managers and short-term rental hosts across the US, with state detail for California, Texas, New York and Florida.

The short version

  1. Strike void clauses before you sign.Look for repair-duty waivers, nonrefundable deposits, lockout clauses and late fees above the state limit. Your state's law decides which ones are void.
  2. Follow your state's deposit cap and holding rules.Check the maximum deposit, where it must be held and any notice you owe the tenant. Never borrow another state's rules.
  3. Itemize deductions with evidence, before the deadline.Compare move-in and move-out photos, attach receipts, and send by the deadline and delivery method your state requires.

Most owners use a lease form they have had for years. The clauses that hurt are the ones the state will not enforce, and the security deposit is where a small slip turns into double or triple damages.

Lease red flags

  • Waiving habitability or repair duties: void in California and New York; Texas allows only the narrow written waivers in Property Code 92.006. Strike it.
  • A nonrefundable security deposit or "cleaning deposit" in California: barred by Civil Code 1950.5. Call it a deposit and refund it.
  • A late fee above the state limit or charged too early (New York: before rent is 5 days late, or above the lesser of $50 or 5% of the monthly rent; Texas: before rent has been unpaid 2 full days after the due date): unenforceable. As of Oct 2026.
  • An automatic increase clause in a California AB 1482 unit above the cap: unenforceable beyond it.
  • Any clause allowing lockout, utility shutoff or removal of belongings for nonpayment: strike it. In Texas, send any temporary lock-change clause to Texas counsel.
  • A "no pets" clause applied to an assistance animal: ordinary pet rules do not apply. Carve out reasonable accommodations, keeping an individualized assessment only where reliable, objective evidence shows the specific animal poses a direct threat or would cause substantial physical damage that another reasonable accommodation cannot reduce or eliminate.

Security deposits in the four big states

The rule

California

Since July 1, 2024, at most one month's rent, with a narrow two-month exception for some small landlords. Return an itemized statement within 21 days, with receipts over $125 and photos; bad faith adds up to twice the deposit. Nothing is nonrefundable. As of Oct 2026.

Civil Code 1950.5

The rule

Texas

No statutory cap. Refund with an itemized list within 30 days after surrender, once the tenant has given a forwarding address. Bad faith, presumed if the deposit is not refunded or accounted for in 30 days, costs $100 plus three times the amount wrongfully withheld plus attorney's fees. A tenant who withholds the last month's rent against the deposit is presumed in bad faith. As of Oct 2026.

Property Code 92.101 to 92.109

The rule

New York

At most one month's rent. Offer a pre-move-out inspection, then return the deposit with an itemized statement within 14 days of move-out, or lose the right to keep any of it. Buildings of 6 or more units hold deposits in an interest-bearing New York account. As of Oct 2026.

GOL 7-108(1-a); GOL 7-103

The rule

Florida

No cap. Hold the deposit in a separate Florida account (non-interest-bearing, or interest-bearing with the tenant's share) or post a surety bond, and give the tenant written notice of where and how within 30 days of receipt. When the tenancy ends and the tenant moves out, refund within 15 days if you have no claim; to claim, send notice of intent within 30 days after the tenancy ends, by certified mail to the tenant's last known mailing address, or by email only if you both signed the statutory email-notice addendum. The tenant has 15 days from receipt to object. Miss the 30-day notice and you forfeit the claim against the deposit, though you can still sue for damages after returning it. As of Oct 2026.

Florida Statutes 83.49(2), (3)(a) and (3)(b); Florida Statutes 83.505

A Los Angeles deposit returned late, with no receipts
Part of the $3,000 deposit kept$1,200
Up to twice the deposit for bad faith$6,000
The most the tenant can recover$7,200

$1,800 of a $3,000 deposit returned 30 days after move-out with no receipts: past the 21-day limit. Refund in full and settle.

AvoidFor example, an Orlando landlord emails a $900 claim against a $2,000 deposit 35 days after the tenancy ended.
Do this insteadSending the notice of intent within 30 days, by certified mail or by email under a signed email-notice addendum, with the itemized claim and the evidence behind it.

In that example day 35 is too late, so the claim against the deposit is forfeited and the full $2,000 goes back.

In any other state, the deposit cap, return deadline and notice rules are set by that state's statute. Check it, and never borrow California or New York rules.

Management agreements

If you manage for owners, settle these in writing: fees (percentage or flat, leasing, renewal, any maintenance markup disclosed), the spending limit without approval, the reserve held, who signs leases and serves notices, eviction handling and counsel, insurance and indemnity, term and termination fees, and the hand-back of trust funds and records. No trust-account terms, no spending limit, or a termination fee that keeps owners captive are red flags to renegotiate before signing.

A move-out that holds up is a comparison: the move-in inspection and photos against the move-out inspection and photos, with itemized deductions and receipts, sent by the deadline and delivery method your state requires.

Asked in Greymill

Example question and answer from Contracts & Disputes
You
Tenant in Orlando moved out 25 days ago. Deposit was $2,000 and I found $900 of damage. Planning to email them the bill with photos in 10 days. Anything I'm missing?
Contracts & Disputes
Yes: send a notice of intent to claim by certified mail now. An email in 10 days loses you the claim.

Florida's deadline: notice of intent within 30 days after the tenancy ends (As of Oct 2026)
Today: day 25, taking move-out as the end of the tenancy, so 5 days left
Your plan: day 35, past day 30, so the claim is forfeited
The cost: the full $2,000 goes back, instead of $1,100 if your $900 claim stands

In the notice: the itemized $900 claim, with move-in against move-out photos and receipts as evidence.
The tenant then has 15 days to object (As of Oct 2026).

The method matters as much as the date. Use certified mail to their last known address. Email counts only if you both signed Florida's email-notice addendum.

Say the word and I'll draft the notice of intent.

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Your question

I run a property management business in [state], in the US. Here are our lease form and our management agreement: [paste them]. Flag any clause that is void or unenforceable in [state] and [city], check our deposit amount, holding account and move-out return process against the state rules, and give me a redline list for our attorney.

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Sources

The primary sources behind this lesson, checked Oct 2026.

  1. 92.006 (Contract red flags)
  2. 1950.5(m) (Contract red flags)
  3. 238-a(2); Prop. Code 92.019 (Contract red flags)
  4. 100.204 (Contract red flags)
  5. 1947.12(a), (d), (m) (California: AB 1482, deposits and unlawful detainer)
  6. 1946.2(a), (b), (d) (California: AB 1482, deposits and unlawful detainer)
  7. 1161(2), (3) (California: AB 1482, deposits and unlawful detainer)
  8. 827(b) (California: AB 1482, deposits and unlawful detainer)
  9. 1946.1(b), (c) (California: AB 1482, deposits and unlawful detainer)
  10. SB 38 (89R, signed) s4 amending Property Code 24.005(a) and adding (c-1); ss17, 18(a) (Texas: property code chapters 24 and 92)
  11. Texas Property Code section 24.005(a), (f-3) and (f-4) (Texas: property code chapters 24 and 92)
  12. TRCP 510 (Texas: property code chapters 24 and 92)
  13. Local Gov. Code 214.902 (Texas: property code chapters 24 and 92)
  14. 7-108(1-a) (New york: hstpa, good cause and new york city rules)
  15. 7-103(2-a) (New york: hstpa, good cause and new york city rules)
  16. 711(2) (New york: hstpa, good cause and new york city rules)
  17. 235-e(d) (New york: hstpa, good cause and new york city rules)
  18. 226-c (New york: hstpa, good cause and new york city rules)
  19. 83.49(2), (3) (Florida: chapter 83 and state preemption)
  20. 83.56(2), (3); 83.57 (Florida: chapter 83 and state preemption)
  21. 83.60(2) (Florida: chapter 83 and state preemption)
  22. 83.62(1) (Florida: chapter 83 and state preemption)
  23. 83.51; 83.64 (Florida: chapter 83 and state preemption)
  24. 83.425; 83.491 (Florida: chapter 83 and state preemption)
  25. Rule 61J2-14 (Hard cases: rent increases, deposits, late fees and screening)
  26. 15 U.S.C. 9058(c)(1); Property Code 24.005(c-1) (SB 38 s4) (Hard cases: rent increases, deposits, late fees and screening)
  27. B&P 10131(b); Tex. Occ. Code 1101.002; RPL 440; Fla. Stat. 475.01 (Property management practice: licenses, trust accounts, agreements)
  28. 1101.005; 1101.806(b) (Property management practice: licenses, trust accounts, agreements)
  29. 10 CCR 2831.2 (Property management practice: licenses, trust accounts, agreements)
  30. 1770(a)(29) (Property management practice: licenses, trust accounts, agreements)
  31. 16 CFR 464.1 (Property management practice: licenses, trust accounts, agreements)
  32. 1954.603 (Operations and software)
  33. Civ. Code 1941.1, 1942.1; RPL 235-b(2); Prop. Code 92.052, 92.006(e) and (f); Fla. Stat. 83.51(1), (2) (Landlord-tenant basics and statewide rent caps)
  34. Civ. Code 1942.5; Prop. Code 92.331; Fla. Stat. 83.64 (Landlord-tenant basics and statewide rent caps)
  35. Rent Stabilization percentages for 2026 and 2027; ORS 90.323 notice, first-year and exemption rules (Landlord-tenant basics and statewide rent caps)
  36. Annual rent increase limit; RCW 59.18.700(1) formula and first-year bar; RCW 59.18.140 notice (Landlord-tenant basics and statewide rent caps)
  37. Texas Local Government Code section 214.902(a) and (b) (Landlord-tenant basics and statewide rent caps)

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