Each state has their own rules and regulations about real estate. Maryland law provides many rules and standards for how landlords should operate their properties. Investing in property can be vastly different from one state to the next, so in order to remain within the confines of the law, you’ll need to become familiar with the local laws in your region. Below you’ll find answers to questions about real estate law in the state of Maryland, including, is there a legal grace period for rent? Should you pay interest on tenant’s security deposits?
Evictions
Maryland landlord tenant laws and laws across the nation dictate the ways in which landlords and tenants can interact in a way that’s fair for both parties. When it comes to evictions, it’s important to follow these rules closely, since evicting a tenant is a serious step that means displacing someone from their home. If you go through with this process, it should be due to a documented, real and pressing issue.
Maryland eviction laws set out three different required notices for evicting a tenant based on the scenario. If a tenant stops paying rent, Maryland law allows landlords to file for eviction immediately after sending a rent demand notice. However, for a lease violation that isn’t due to nonpayment of rent or fees, landlords must give their tenants a 30-day notice to quit. There is one exception to this requirement: If a tenant engages in dangerous or harmful behavior, the landlord may send a 14-day unconditional notice to quit and file for eviction after only two weeks.
Rent and Fees
Each state sets its own guidelines for charging tenants rent and other fees. In Maryland, landlords can charge up to $25 in application fees. If the tenant turns in rent late and past the grace period, you can charge a late fee of 5% or less of the tenant’s monthly rent. There is no mandatory grace period, so you are not required to provide tenants extra time after rent is due to pay their bill (however, many landlords do provide three-to-five-day grace periods regardless). There also is no statewide rent control in Maryland.
Maryland allows tenants to withhold rent if their landlord refuses to repair a serious problem. The tenant must send a notice to their landlord via certified mail to let them know about the condition, and if the landlord has not repaired it within a reasonable amount of time, the tenant can withhold rent or bring action of rent escrow into court.
Security Deposits
When a new tenant moves in, there are a lot of tasks that need to be completed. One of those tasks you must do as a landlord is collect your tenant’s security deposit and correctly store it during their tenancy. According to Maryland security deposit laws, landlords must pay tenants interest on their deposits and keep them in interest-bearing accounts, although no interest is required if the deposit is held for less than six months or is less than $50. These deposits should be kept in federally insured financial institutions in Maryland and need to be kept separate from other funds. The landlord must deposit the deposit into this account within 30 days of receiving it.
Upon the lease’s termination, the landlord must return the security deposit in a timely manner with all the proper withholdings documented. It’s best to treat security deposits as though you are going to return the amount in full. In Maryland, landlords need to provide a list of all deductions when they return the remaining amount, and they must return that amount within 45 days.
Required Disclosures
There is certain information that landlords are legally obligated to notify their incoming tenants of regarding their new home. Maryland has a couple of required disclosures that you will need to know.
First, landlords must include a receipt acknowledging all security deposits in the written lease agreement. Tenants should know that they are within their rights to be present during move-in/move-out inspections and that they will receive a written list of deductions at the conclusion of their tenancy.
Also, if you use a ratio utility billing system, you must notify tenants about how the utilities are allocated between tenants.
Conclusion
Investing in a new property anywhere can be overwhelming. The best way to treat your tenants fairly and to avoid any lawsuits is to read up on the laws in your state and, if needed, get an attorney to help you navigate them. Use the guide above to start your research on Maryland’s state laws.
