Deposit (Rental Security)

A deposit, also known as rental security, is a sum of money that tenants pay to landlords to cover potential damages or unpaid rent. For instance, when renting an apartment, you may need to pay a deposit equivalent to two months’ rent. This deposit is returned at the end of the lease, provided there are no damages.

This matters because it gives landlords security. Tenants should ensure that the deposit is kept in a separate account to prevent misuse. According to § 551 of the BGB, the deposit can be a maximum of three months’ rent. A common mistake is failing to pay the deposit on time, which can lead to issues during the apartment handover.