What Are Permitted Uses of the Security Deposit by a Landlord or Agent?

Audience: renters in North Carolina who want to understand what their deposit can legally be used for

State law strictly limits what the deposit may be applied to, and any deductions must be lawful, itemized, and tied to real costs after the tenancy ends.

Here’s what landlords can and cannot use a security deposit for.

Permitted uses of a security deposit in North Carolina ⚖️

After you move out and return possession of the property, a landlord may apply the security deposit toward:

Unpaid rent owed at the end of the tenancy
Damage beyond normal wear and tear
Cleaning costs required due to excessive filth or neglect
Costs caused by lease violations that result in actual financial loss
Unreturned keys, remotes, or access devices, if addressed in the lease
Court costs related to summary ejectment, if allowed by the lease

These deductions must be reasonable, documented, and itemized.

For context on how deposits are handled at move-out, see:
https://movezen360.com/nc-security-deposit-end-of-lease

What counts as “damage” vs. normal wear and tear 🧾

This distinction matters a lot.

Normal wear and tear (not deductible) includes:

Minor scuffs on walls
Worn carpet from ordinary use
Faded paint
Loose handles or hinges from age

Damage beyond normal wear and tear (potentially deductible) includes:

Large holes in walls
Broken fixtures caused by misuse
Pet damage beyond ordinary wear
Stains, burns, or gouges
Missing or damaged appliances

Routine aging of the home is not your financial responsibility.

Cleaning charges: what’s allowed 🧹

A landlord may deduct cleaning costs only if:

The unit was left excessively dirty
Cleaning goes beyond normal turnover cleaning
Costs are tied to actual services performed

Light dust, normal floor wear, or routine repainting are generally not deductible.

What security deposits cannot be used for 🚫

Landlords and agents may not use a security deposit for:

Normal wear and tear
Routine maintenance
Upgrades or renovations
Improvements that increase property value
Pre-existing issues noted at move-in
Costs unrelated to your tenancy
Charges not allowed by the lease

Deposits are meant to cover loss — not to improve the property.

Timing and documentation requirements ⏱️

Even when deductions are allowed:

The landlord must provide a written, itemized accounting
Deposit return or interim accounting must occur within 30 days
Final accounting must be completed within 60 days

More on timelines here:
https://movezen360.com/nc-security-deposit-return-deadline

How early move-out or unpaid rent affects deductions 🔍

If you vacate early or owe rent:

Unpaid rent may be deducted
Lease termination fees may apply if lawful and disclosed
The landlord must still mitigate damages by attempting to re-rent

What renters can do to protect their deposit ✅

Document move-in condition with photos
Follow move-out instructions carefully
Clean thoroughly before leaving
Repair tenant-caused damage if permitted
Return all keys and access devices
Provide a forwarding address in writing

Good documentation reduces disputes later.

FAQs ❓

Can a landlord charge for repainting?
Only if repainting is required due to damage beyond normal wear.

Can cleaning always be deducted?
No. Only excessive cleaning beyond ordinary use.

Can a landlord deduct for carpet replacement?
Only if damage exceeds normal wear and tear and the carpet hasn’t reached the end of its useful life.

Can deductions exceed my deposit?
Yes. but only for lawful charges. You may still owe additional amounts.

Can estimates be used instead of actual costs?
Final deductions should reflect actual or reasonably certain costs, not vague estimates.