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Do landlords have to pay interest on security deposits in New York, and when is it due?
Short answer
Deposit interest: tenant's option to be paid annually (6+ unit buildings)
Payment timing: Each year on the lease anniversary
Interest on deposits (minus a 1%-per-year admin fee) belongs to the tenant, who can choose to have it paid annually, applied to rent, or paid at the end of the lease.
"Landlords are entitled to collect annual administrative expenses of 1% of the deposit. All other interest earned on the deposits belongs to the tenant. Tenants must be given the option of having this interest paid to them annually, applied to rent, or paid at the end of the lease term." ag.ny.gov
Deposit interest: tenant's option to be paid annually (6+ unit buildings) Verified
Deadline: Each year on the lease anniversary
Interest on deposits (minus a 1%-per-year admin fee) belongs to the tenant, who can choose to have it paid annually, applied to rent, or paid at the end of the lease.
Who it covers: Landlord may keep 1% of the deposit per year as an administrative fee; the rest of the interest belongs to the tenant.
"Landlords are entitled to collect annual administrative expenses of 1% of the deposit. All other interest earned on the deposits belongs to the tenant. Tenants must be given the option of having this interest paid to them annually, applied to rent, or paid at the end of the lease term." ag.ny.gov
Notes: General Obligations Law § 7-103. NY statute text on nysenate.gov returned HTTP 403 to curl; rule sourced from the NY Attorney General's official guide instead. Annual timing applies only if the tenant elects annual payment.
Last verified 2026-10-20 · Confidence: medium · Status: verified · Report a correction