Security Deposit
A refundable amount collected by the association to cover potential damages to common areas during specific activities such as moving, construction, or event hosting. Security deposits are returned after the activity is completed and an inspection confirms no damage occurred. Associations must handle security deposits in compliance with any applicable state regulations regarding refund timelines and itemization of deductions.
Example in Context
The association returned the $500 move-in deposit within two weeks after inspecting the elevator, hallways, and lobby and confirming no damage occurred during the move.
Related Terms
Frequently Asked Questions
How long does an HOA have to return a security deposit?
Timelines vary by state and by the association's governing documents. Generally, the association should return the deposit within a reasonable time after the activity is completed and an inspection confirms no damage — typically 14 to 30 days. Any deductions must be itemized in writing.