Security Deposit Alternative in Maryland
Maryland caps a security deposit at one month's rent per unit no matter how many tenants sign, and charging more exposes you to three times the excess plus the resident's attorney fees. You then have 45 days after the tenancy ends to mail a written list of the damages you are claiming with an itemized statement of what each one cost. Miss that deadline and you forfeit the right to withhold anything at all, however real the damage was.
What Maryland law says about security deposits
Read from the Maryland statute on 2026-09-09. Deposit rules change, and this is general information rather than legal advice. Confirm the current text with your own counsel before you change a lease.
Can you require it of every Maryland resident?
Maryland sets out the alternative in the deposit statute itself, and it is the most detailed version of this in any state we have read. Subsection (i)(1) draws the line in both directions: a landlord may not require the tenant to purchase a surety bond, and is not required to consent to one. A tenant who does buy one buys protection for the landlord against nonpayment of rent, damage from breach of the lease, and damage beyond ordinary wear and tear to the unit, common areas, major appliances or furnishings you own. The bond cannot exceed two months' rent, a bond and a deposit together cannot exceed two months' rent, and charging past either ceiling costs you three times the excess plus the resident's attorney fees. The surety also has to disclose in writing, before the resident buys, that the payment is nonrefundable, that the bond is not insurance for the tenant, that it protects the landlord, and that the resident may have to reimburse the surety.
Fee-in-lieu provision: Md. Real Property 8-203(i), read on 2026-09-09.
Rules differ by state and by city, and subsidized housing is its own question. This is general information for property managers, not legal advice. Get a written opinion before you make the fee a condition of tenancy anywhere.
How the program works in Maryland
The mechanics are the same in every state Beagle operates in. The program is designed to comply with applicable state and local regulations, and the rate is set by the deposit amount rather than by geography, so a Maryland property and one two states over are quoted the same way.
The resident chooses at signing
Instead of producing the full deposit, the resident pays a smaller non-refundable monthly fee that is billed with rent. Nothing is held, so nothing has to be returned.
The property keeps its protection
Damage beyond normal wear is reimbursed up to the deposit amount the unit would otherwise have required, so what you can recover does not shrink.
Move-out stops being a negotiation
A claim is filed against the program rather than deducted from money you are holding, which takes the itemised-deduction letter and the dispute that follows it off your team's desk.
You earn on every resident who takes it
You set an administrative fee on top of the premium, up to $5 per unit per month, and keep it.
Maryland security deposit alternative FAQs
No. Real Property 8-203(i) says a landlord may not require a tenant to purchase a surety bond, and is not required to consent to one either. Where you do agree to it, the bond cannot exceed two months' rent, a bond and a deposit together cannot exceed two months' rent, and going past either ceiling costs three times the excess plus attorney fees.
Security deposit rules in other states
See it on your Maryland units
Run the program against your own unit count, or walk through it with our team. No upfront fees, no onboarding charges, no long-term contracts.