Earn up to 4.19% APY2.  No account fees. No minimum balances.

Security Deposit Account for Landlords in California

Never chase down checks or late rent payments again. Accept
rent by ACH or card. Automated payments, fees & reminders.

  • Multiple accounts per property
  • No account fees or minimum balances
  • 4.19% APY interest and up to 5% cash back†
security deposit Baselane app

Benefits of security deposit accounts in California

Landlords

  • Provides financial protection for landlords in the event of property damage caused by tenants.
  • Allows landlords to recoup losses from unpaid rent or other costs associated with the lease agreement.
  • Covers the cost of any repairs that need to be done on the property after a tenant leaves.
  • Gives landlords peace of mind that there will be a financial cushion 
if anything goes wrong during the tenancy period.
Security deposits before buying property

Tenants

  • Security deposits help protect tenants financially in the event
 of unexpected damages.
  • Give tenants the peace of mind that they will be able to get back their deposit after the end of the lease if nothing is wrong.
  • Tenants can use security deposits to cover repairs, maintenance, 
and cleaning costs at the end of a lease agreement.
  • Security deposits are refundable and allow tenants to save money 
in comparison to having to pay out-of-pocket for unexpected costs 
or damages.
Baselane account information of renters
Security deposit rules in California
  • Limit: Two months’ rent or three months’ rent for furnished units
  • Return Deadline: The security deposit must be returned within 21 days after the lease term ends
  • Acceptable Deductions: Unpaid rent (including late fees), cost of cleaning, and damage beyond normal wear and tear
  • Where to Deposit: Interest-bearing accounts are not required for security deposits in California
security deposit rules in California

Why California landlords choose Baselane

Why choose rental security deposit account
  • All-in-One Platform with Banking, Rent Collection, and Accounting and more
  • Eligible to hold Security Deposits**
  • Free Rent Collection that’s landlord and renter friendly
  • Earn 4.19% APY and up to 5% Cash Back
  • Comprehensive cash flow analytics and reporting
  • Modern user interface and experience
  • Excellent Customer Support

**NOT LEGAL ADVICE. Please consult with an attorney and/or local city and state laws and requirements.

Baselane rental escrow account
Baselane Maintenance card
Take Control of Your Spend

Open a security deposit bank account and use physical & virtual debit cards with custom spend controls and automated transaction tagging with Schedule E categories.

Easily Collect and Return Security Deposits

Collect funds into an account for security deposit via Bank Transfers (ACH payments), Deposit checks, or Wire.

Multiple modes of Payment

Easy to get started

1

Open a security deposit bank
account for free

Customer total balance in virtual card
2

Create a Virtual account
(aka - rental security deposit account)

Virtual account image
3

Collect security deposits

into a virtual account

Security Deposits amount image

Explore more Baselane features

Banking
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Accounting
Insurance
Loans

Frequently asked questions

How much is a security deposit in California?

The amount of a security deposit in California depends on the type of rental unit. For unfurnished residential units, the maximum security deposit a landlord can charge is the equivalent of two months’ rent. For furnished units, the maximum is three months’ rent. However, landlords of single-family homes and condos can charge any amount as a security deposit. It is important to note that a landlord may deduct certain expenses from the security deposit, such as unpaid rent or the cost of repairing damages beyond normal wear and tear.

In what other states can you use Baselane?

These are the other states where you can use Baselane: Arizona, California, Illinois, New Jersey, Texas, Virginia & all major states in the USA.

How is the security deposit amount determined when using the Baselane service?

Tenants can cause a lot of damage to your rental property, so you should aim to collect the largest security deposit the market will bear. One month’s rent is typical in most parts of the country, but you may be able to demand more if your rental property is in a particularly hot market.

Your state may set a cap on how much you can collect. Many states, including New York, Massachusetts, and Ohio, set the maximum security deposit you can collect at one month’s rent. Others, including California, Pennsylvania, and Maryland, limit security deposits to 2 months’ rent. There’s no limit on security deposits for rentals in Indiana and Florida.

How is my personal information and funds protected when using the Baselane security deposits accounts?

You should collect the security deposit and the first month’s rent when your new tenant signs the lease. Be sure to give your tenant a detailed receipt for their deposit that includes all information required by local law. Consider using Baselane for automated rent collection to get paid faster, simplify your bookkeeping and ensure you’re handling your deposits appropriately.

Do I need a new security deposit agreement if my tenant switches to month-to-month rent?

If local law states a lower maximum security deposit for month-to-month leases, you may be required to refund the excess amount. Otherwise, the initial terms of the lease usually continue to apply when switching to month-to-month, and no change to the security deposit is required.

When can I collect the security deposit?

You should collect the security deposit and the first month’s rent when your new tenant signs the lease. Be sure to give your tenant a detailed receipt for their deposit that includes all information required by local law. Consider using Baselane for automated rent collection to get paid faster, simplify your bookkeeping and ensure you’re handling your deposits appropriately.

© 2024, Skylight Financial Services Inc. (Baselane). All Rights Reserved.


Baselane is a financial technology company and is not a bank. Banking services provided by Thread Bank, Member FDIC. FDIC insurance is available for funds on deposit through Thread Bank, Member FDIC. The Baselane Visa Debit Card is issued by Thread Bank, pursuant to a license from Visa U.S.A. Inc. and may be used everywhere Visa is accepted.

1Your deposits qualify for up to $3,000,000 in FDIC insurance coverage when placed at program banks in the Thread Bank deposit sweep program. Your deposits at each program bank become eligible for FDIC insurance up to $250,000 , inclusive of any other deposits you may already hold at the bank in the same ownership capacity. You can access the terms and conditions of the sweep program at https://go.thread.bank/sweepdisclosure and a list of program banks at https://go.thread.bank/programbanks. Please contact customerservice@thread.bank with questions on the sweep program.

2The Annual Percentage Yield (APY) on your Savings Account is accurate as of 04/05/23. Total balances across Checking Accounts and Savings Accounts are used to calculate APY tier, but only money in Savings Accounts is eligible for interest. Total balances less than $10,000 earn 1.95% APY for Savings Accounts. Total balances between $10,000 and $24,999 earn 2.93% APY for Savings Accounts. Total Balances between $25,000 and $49,999 earn 3.40% APY for Savings Accounts. Total balances of $50,000 or more earn 4.19% APY for Savings Accounts. These are variable rates and are subject to change based on the target range of the Federal Funds rate. There are no minimum balances or minimum deposits required to earn interest on your Savings Account. Review the Baselane Business Deposit Account Agreement for more information.

3Cash back is credited once per month for all rewards above 1% and credited to your account with a maximum of $2,000 annual spend per calendar year. 1% cash back is credited instantly following purchase with no maximum spend. No minimum spend applies. Terms and conditions apply.

*All testimonials, reviews, opinions or case studies presented on our website may not be indicative of all customers. Results may vary and customers agree to proceed at their own risk.

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