When and How Landlords Can Withhold Security Deposits from Tenants in Colorado

If you're a landlord in Denver, Boulder, or anywhere in Colorado, there may be a time when you need to withhold security deposits from tenants. Security deposits are there to protect you, but it's important to withhold them only when there is legal cause to do so and to always withhold in a compliant way.

At Flaxman Law Group, we often heard from individuals engaged in disputes over security deposits, which is why we've put together this guide. If you need further help, contact our Colorado offices at 970-999-0530 to schedule a consultation with a Colorado landlord-tenant dispute attorney.

As a landlord in Colorado, you have a few specific reasons why you can withhold part of a tenant's rent:

• Unpaid rent. The most common cause of withholding a deposit is because a tenant hasn't paid rent. In this situation, it's essential to document any unpaid rent and provide a clear breakdown of the deductions you're making in an itemized statement. Keep very careful records of when rent is paid and how much is paid, in case any dispute occurs.
• Damage to the property. You can't withhold a security deposit for normal wear and tear, which is the expected decline of the property caused by ordinary use. However, if a tenant inflicts intentional damage or damage caused by negligence, you can withhold enough of the security deposit to pay for repairs.
• Additional causes. The lease agreement may require the tenant to clean the rental when they move out or to pay utilities or meet other obligations. If they fail to do so, you can withhold the necessary funds from the security deposit to cover these costs.

How much you can withhold from a security deposit in these cases depends on how much damage or non-payment amounts to. Always keep plenty of evidence so you can show exactly how much a situation is costing you and how much it would be reasonable to withhold.

To withhold a security deposit when a Colorado tenant moves out, you will need to:

• Act fast. In Colorado, landlords must return the security deposit within one month after the tenant moves out.
• Communicate in writing. You must provide written notice to a tenant within one month, outlining what is being deducted from the security deposit, how much, and why.
• Provide details. Your written notice to the tenant needs to include an itemized statement outlining the specific reasons for each deduction. Include detailed descriptions of any damages or non-payment of rent, the cost of repairs or the outstanding balance, and any supporting documentation.

Security despots are a frequent cause of disagreements and even legal disputes in Denver, Boulder, and across Colorado. It's not uncommon for landlords and tenants to disagree about what constitutes wear and tear and how much repairs should cost. Landlords and tenants may also have different records about when rent was paid.

Here's how to prevent disputes or at least to resolve them quickly:

• Keep lots of evidence. Keep good records of when tenants paid rent, in full or in part, so you can show the books. In situations involving damages, take photos and videos of the damage and get repair estimates from multiple contractors so you can prove the damage happened and get a fair quote for the cost of repairs.
• Communicate clearly. When a tenant is about to move out, review the lease agreement together so there are no surprises. Set up a move-out walk-though of the rental so you can review any damage together. As much as possible, communicate formally in writing so you have proof of your communication.
• Seek legal help early. If any disagreements arise, contact an attorney right away. This can help protect your rights and start the mediation process, you may be able to keep the dispute out of the courts.

If you need a lawyer in Denver or anywhere else in Colorado, contact Flaxman Law Group at 970-999-0530 for a consultation with a Colorado landlord-tenant dispute attorney. We're here to help you avoid disputes and to protect your rights.