Security Deposit Interest in New Jersey: Interest actually (2026)
New Jersey landlords must keep security deposits in an interest-bearing account in a New Jersey bank and credit or pay the interest to the tenant… Calculator, statute citation, Last Verified date o
Quick answer
Yes — New Jersey requires landlords to pay interest on qualifying security deposits. New Jersey landlords must keep security deposits in an interest-bearing account in a New Jersey bank and credit or pay the interest to the tenant annually; in municipalities with rent leveling, N.J.S.A. 2A:18-61.13 sets an annual interest formula tied to the average rate on six-month bank CDs as published by the DCA. The rule comes from N.J.S.A. 46:8-19 et seq. (Security Deposit Law); N.J.S.A. 2A:18-61.13 (rent-leveling municipalities). State statute (official text) · 2026-10-28
Calculator pre-loaded with this state:
The current rate in New Jersey
New Jersey does not fix the rate in the statute — it moves with a benchmark: Security Deposit Law (N.J.S.A. 46:8-19 et seq.): deposit in interest-bearing NJ bank account, tenant notified of bank name/address within 30 days; landlords of 10+ units must pay interest annually or credit it against rent, smaller landlords credit annually. N.J.S.A. 2A:18-61.13 (rent-leveling municipalities, owner-occupied <3 units exempt): annual interest based on the published six-month CD rate — one search snapshot describes 'minus 1 percentage point', another 'as published by the Federal Reserve Board'; the DCA-published current rate for 2026: (to be verified)..
Because the benchmark resets periodically, always check the current published value before relying on an older figure. Where we have confirmed the current value against the official announcement, the calculator above applies it; where we have not, the calculator says so instead of guessing.
How interest must be paid
Not specified in sources reviewed; annual accrual/credit Annually — credited against rent due or paid directly; on increase of rent the landlord may collect additional security. Deposit plus accrued interest due within 30 days after lease termination and delivery of possession; failure exposes landlord to double-deposit liability (tenant may sue for double the amount).
Who the law applies to
All residential landlords (owner-occupied premises with fewer than three rental units are exempt from the 2A:18-61.13 rent-leveling interest formula); deposit capped at 1.5 months' rent
Cities that add their own rules
Rent-leveling municipalities (e.g., Newark, Jersey City) apply the 2A:18-61.13 annual interest formula on top of the general Security Deposit Law.
How New Jersey compares in the Northeast
| State | Rate | Rule |
|---|---|---|
| Connecticut | Not less than the 'deposit index' for that year as defined in C.G.S. § | interest required |
| Delaware | — | no statewide requirement |
| District of Columbia | Interest accrued in the interest-bearing escrow account at the prevail | interest required |
| Maine | — | no statewide requirement |
| Massachusetts | 5% per annum, or the lesser amount of interest actually received from | interest required |
| New Hampshire | Interest at the rate paid on regular savings accounts at the bank wher | interest required |
| New Jersey | Interest actually earned in the NJ interest-bearing account (no statew | interest required |
| New York | Interest actually accrued/paid on the deposit in the interest-bearing | interest required |
| Pennsylvania | Interest earned in the bank escrow account, with the landlord retainin | interest required |
| Rhode Island | — | no statewide requirement |
| Vermont | — | no statewide requirement |
The statute behind it
| Field | Value | | --- | --- | --- | | Citation | N.J.S.A. 46:8-19 et seq. (Security Deposit Law); N.J.S.A. 2A:18-61.13 (rent-leveling municipalities) | | Official text | www.nj.gov | | Last verified | 2026-10-28 |
Cross-checked against: LSNJLaw (Legal Services of New Jersey) — Security Deposits: Obligations, Limits, Collections, NJ Courts — What Happens to the Residential Security Deposit? (official judiciary FAQ).
Statutes get amended. If you are relying on this page — for a move-out, a dispute, or a lease draft — click through to the official text and confirm the current wording.
FAQ
Does New Jersey require landlords to pay interest on security deposits?
Yes. Under N.J.S.A. 46:8-19 et seq. (Security Deposit Law); N.J.S.A. 2A:18-61.13 (rent-leveling municipalities), qualifying landlords in New Jersey must pay interest — currently Interest actually earned in the NJ interest-bearing account (no statewide fixed minimum verified); in rent-leveling municipalities: average rate of interest paid on six-month certificates of deposit as determined/published annually (formula published by NJ DCA). All residential landlords (owner-occupied premises with fewer than three rental units are exempt from the 2A:18-61.13 rent-leveling interest formula); deposit capped at 1.5 months' rent
How is deposit interest calculated in New Jersey?
At Interest actually earned in the NJ interest-bearing account (no statewide fixed minimum verified); in rent-leveling municipalities: average rate of interest paid on six-month certificates of deposit as determined/published annually (formula published by NJ DCA). Not specified in sources reviewed; annual accrual/credit The calculator at the top of this page applies exactly this rule to your deposit amount and dates.
When do I get the interest?
Annually — credited against rent due or paid directly; on increase of rent the landlord may collect additional security. Deposit plus accrued interest due within 30 days after lease termination and delivery of possession; failure exposes landlord to double-deposit liability (tenant may sue for double the amount).
Independent second source · 2026-10-28Related guides
- All states: security deposit interest by state · rent increase rules by state
- Tools: deposit interest calculator · rent increase calculator
- Neighboring states: Connecticut · Delaware
This page is information, not legal advice — see the full disclaimer.