Michigan Security Deposit Law

Maximum deposit

Landlords may not require a security deposit of more than 1.5 months' rent (MCL 554.602). (MCL 554.602)

One and one-half months' rent

Return deadline

Within 30 days after the tenant moves out, the landlord must mail an itemized notice of damages with the balance, or else return the full deposit immediately (MCL 554.609-554.610). (MCL 554.609(1)-(2), MCL 554.610, MCL 554.613)

Itemized statement of deductions

A landlord claiming damages must mail an itemized list with estimated repair costs within 30 days after the tenancy ends (MCL 554.609). (MCL 554.609, 2026 PA 102)

Interest on the deposit

Michigan law does not require landlords to pay interest on security deposits, though the deposit must be kept in a regulated financial institution unless the landlord posts a bond (MCL 554.604). (MCL 554.601-554.616 (silent on interest); MCL 554.604)

Penalty for wrongful withholding

A landlord who does not follow the notice and court-action rules waives all claimed damages and owes the tenant double the deposit retained (MCL 554.613(2)). (MCL 554.613(2), MCL 554.610)

Where the deposit is held

A Michigan landlord must put security deposits in a regulated financial institution unless it files a cash or surety bond with the Secretary of State, in which case it may use the deposit money for any purpose (MCL 554.604(1)). (MCL 554.604, MCL 554.605)

The bond must secure all deposits up to $50,000 plus 25% of any amount above $50,000, be written by a licensed surety acceptable to the Attorney General, and run to the benefit of tenants, who may sue on it (MCL 554.604).

Receipt or written notice of the deposit

No later than 14 days after the tenant takes possession, a Michigan landlord who requires a deposit must give written notice of its name and address, the name and address of the financial institution or surety holding the deposit, and the tenant's duty to send a forwarding address within 4 days after moving out (MCL 554.603). (MCL 554.603)

The forwarding-address warning must be printed in 12-point boldface at least 4 points larger than the body text; if the landlord omits the information, the tenant is relieved of the duty to send a forwarding address.

Move-in condition checklist

Michigan landlords who take a deposit must give tenants two blank copies of a move-in inventory checklist when the lease starts, and the tenant has 7 days after getting possession to note the unit's condition and return one copy (MCL 554.608). (MCL 554.608)

The checklist must cover landlord-owned items such as carpeting, appliances, walls, fixtures and furniture, match the move-out form, and carry a boldface notice; at move-out the landlord completes a termination checklist of claimed damages, and tenants may ask for the prior tenant's termination checklist.

Pet deposits

Michigan has no pet-deposit statute, so a refundable pet deposit is part of the 1.5-month security deposit cap while a nonrefundable pet fee is left to the lease (MCL 554.601(d), 554.602). (MCL 554.601(d), MCL 554.602)

Nonrefundable fees

Michigan does not ban nonrefundable fees, but any refundable fee or deposit, and any required prepaid rent beyond the first full rental period, counts as a security deposit subject to the 1.5-month cap (MCL 554.601(d)). (MCL 554.601(d))

Small-landlord exemptions

Michigan's deposit act reaches every residential rental unit, including single- and two-family homes, rooming houses and mobile home spaces, with no exemption for small or owner-occupant landlords (MCL 554.601(c)). (MCL 554.601(c), MCL 554.616)

Deposit alternatives and installments

Michigan has no law on deposit-alternative products, deposit insurance or paying a deposit in installments; the only bond in the act is one the landlord posts to secure deposits it already holds (MCL 554.604). (MCL 554.604)