Michigan Landlord-Tenant Laws: Security Deposits and Rules Every Landlord Should Know
Michigan security deposit law and the other landlord rules that matter most, from the 1.5-month cap and 30-day deadline to repairs, entry, and fair housing.
Michigan caps a security deposit at one and a half months' rent, and the landlord must return it, or mail an itemized list of damages, within 30 days after the tenant moves out. Those two rules sit inside a tightly timed process with notices, a move-in checklist, and a 45-day window to sue, and a landlord who misses a step can owe the tenant double the amount they kept.
This guide walks through the Michigan landlord laws that trip up owners most often: the Security Deposit Act, the Truth in Renting Act, repair duties, entry, late fees, fair housing, and the extra layer Detroit adds on top. It's a practical overview, not legal advice. For a specific dispute, talk to a Michigan attorney.
How much can a Michigan landlord charge for a security deposit?
No more than 1.5 times the monthly rent (MCL 554.602). On a $1,200 rental, the maximum is $1,800.
The cap covers more than the line item labeled "security deposit." Under Michigan law, any refundable fee or deposit, and any prepaid rent beyond the first rental period, counts toward the total (MCL 554.601). That means a refundable pet deposit, key deposit, or "last month's rent" collected at move-in all count against the 1.5-month limit. The Michigan Legislature's Practical Guide for Tenants and Landlords gives an example: with $500 rent and a $750 deposit, adding a $100 refundable fee pushes the landlord over the cap.
Nonrefundable fees are different. They aren't security deposits by definition, so they don't count toward the cap, though the same guide notes courts can still apply a general test of reasonableness to some fees.
The deposit also isn't yours. Michigan law treats it as the tenant's property until you establish a right to keep some or all of it (MCL 554.605).
Where does a Michigan landlord have to keep the deposit?
You have two options under MCL 554.604:
- Deposit it in a regulated financial institution, such as a bank or credit union, or
- File a cash bond or surety bond with the Michigan Secretary of State that secures the deposits. With a bond in place, you may use the deposit money for any purpose.
Mixing deposits into your operating account without a bond is the shortcut to avoid.
If you sell the property, you stay on the hook for the deposit until you return it to the tenant, transfer it to the buyer and mail the tenant the new owner's name and address, or the new owner deposits it or posts a bond (MCL 554.614).
What notice does a landlord owe the tenant within 14 days?
Within 14 days after the tenant takes possession, you must give the tenant written notice of (MCL 554.603):
- Your name and the address where the tenant should send communications about the tenancy
- The name and address of the financial institution holding the deposit, or the surety company if you filed a bond
- The tenant's obligation to give you a forwarding address in writing within 4 days after moving out
The statute sets specific formatting for the forwarding-address notice: it must be in bold type, larger than the body of the lease, so it stands out. Most landlords put all three items in the lease itself, which works as long as the wording and formatting follow the statute.
What is the Michigan inventory checklist, and why does it matter?
At move-in, you must hand the tenant two blank copies of an inventory checklist covering the items in the unit that belong to you (MCL 554.608). The first page must tell the tenant to complete it and return it within 7 days (you can agree to a shorter period, not a longer one). A tenant can also ask for a copy of the previous tenant's move-out checklist, and you must provide it.
At move-out, you complete a termination inventory checklist noting the condition of the unit. Comparing the two checklists, plus dated photos at both ends, is how you prove damage happened during this tenancy.
What happens to the deposit when the tenant moves out?
The tenant gives a forwarding address. The tenant must provide a forwarding address in writing within 4 days of moving out. If they don't, you aren't bound by the 30-day itemized-list requirement for that tenant, and the burden of going to court shifts to the tenant (MCL 554.611).
You respond within 30 days. Within 30 days after the tenancy ends, you must either return the full deposit or mail an itemized list of damages along with a check or money order for any balance (MCL 554.609). The list must include a statutory notice telling the tenant they have 7 days to respond by mail or they forfeit the amount claimed (MCL 554.610).
You can only deduct three things (MCL 554.607):
- Unpaid rent
- Unpaid utility bills
- Damage beyond reasonable wear and tear
Normal wear (faded paint, light carpet wear, small nail holes) is not a deduction.
The tenant can dispute. A tenant who disagrees must respond in detail, by mail, within 7 days of receiving your list (MCL 554.612).
You sue within 45 days, or settle. If the tenant disputes and you don't reach a written agreement, you must file suit within 45 days after the tenant moves out to keep the disputed amount (MCL 554.613).
What are the penalties if a landlord gets it wrong?
Under MCL 554.613, a landlord who fails to comply with the move-out procedure waives the damages claimed and can be liable for double the amount of the deposit retained. Michigan Legal Help also notes that the security deposit rules cannot be waived by agreement between you and the tenant, so a lease clause trying to opt out of them does nothing.
Losing the deposit claim doesn't erase what the tenant owes. The Legislature's guide explains that you can still sue separately for unpaid rent, utilities, or damage.
Michigan security deposit deadlines at a glance
| When | Who | What | Statute |
|---|---|---|---|
| Before or at move-in | Landlord | Collect no more than 1.5 months' rent; hold it in a regulated financial institution or post a bond | 554.602, 554.604 |
| At move-in | Landlord | Give the tenant two blank inventory checklists | 554.608 |
| Within 7 days of move-in | Tenant | Return the completed checklist | 554.608 |
| Within 14 days of move-in | Landlord | Written notice: your address, where the deposit is held, 4-day forwarding address rule | 554.603 |
| Within 4 days of move-out | Tenant | Give a forwarding address in writing | 554.611 |
| Within 30 days of move-out | Landlord | Return the deposit or mail an itemized list plus any balance | 554.609 |
| Within 7 days of receiving the list | Tenant | Dispute by mail, in detail | 554.612 |
| Within 45 days of move-out | Landlord | File suit for any disputed amount, or settle in writing | 554.613 |
What does the Michigan Truth in Renting Act require in a lease?
The Truth in Renting Act (MCL 554.631 to 554.641) governs most residential leases. Two parts matter most.
A required notice. Covered leases must include a statement, in a prominent place and at least 12-point type, telling the tenant that Michigan law establishes rights and obligations for parties to rental agreements and that the lease must comply with the Truth in Renting Act (MCL 554.634). The exact wording is in the statute; copy it word for word.
Prohibited clauses. A lease may not include a clause that, among other things (MCL 554.633):
- Waives the tenant's remedies when the property isn't fit and habitable
- Waives rights under the security deposit law
- Discriminates in violation of civil rights law
- Waives the right to a jury trial or to notice and procedures required by law
- Makes a party pay the other side's attorney fees beyond what a statute allows
- Lets the landlord change lease terms mid-lease without the tenant's written consent (with narrow exceptions on 30 days' notice for things like legal changes and tax, utility, or insurance increases, if the lease allows them)
A prohibited clause is void, but the rest of the lease survives. If a tenant points out the problem in writing, you have 20 days to fix it (MCL 554.635). If you don't, the tenant can sue and recover $250 per prohibited clause, $500 for a missing required disclosure, or actual damages, whichever is greater (MCL 554.636).
Generic lease templates from national websites often miss the Michigan notice or include clauses the act forbids. A local property manager who uses a Michigan-compliant lease takes this risk off your plate.
What repairs is a Michigan landlord responsible for?
Under MCL 554.139, every residential lease includes a promise that the landlord will keep the property and common areas:
- Fit for the use intended by the parties
- In reasonable repair during the lease
- In compliance with state and local health and safety laws
The exception is damage caused by the tenant's willful or irresponsible conduct. The statute lets the parties modify these duties only in a lease with a current term of at least one year, and the Truth in Renting Act still bars clauses that waive the tenant's remedies for unfit conditions, so don't treat that as a loophole.
"Reasonable repair" isn't defined, so it comes down to the facts. In practice, a furnace failure in January or an active roof leak needs action right away, while a dripping faucet can wait for a scheduled visit. Michigan Legal Help explains that tenants facing unaddressed repairs may withhold rent or repair and deduct in some situations, and unresolved repairs are a common defense when a landlord files for nonpayment. Fast, documented repairs protect your rent, which is why a Detroit property manager with its own maintenance crews is worth weighing if you own from a distance.
Can a Michigan landlord enter the unit?
Michigan doesn't have a statute setting a specific notice period for landlord entry. According to Michigan Legal Help, a landlord needs the tenant's permission to enter except in an emergency, and should give reasonable notice before entering to make repairs. The sample lease in the Legislature's guide leaves a blank for the number of hours' notice and asks the landlord to notify the tenant within 2 days after any emergency entry.
Put an entry clause with a clear notice period in the lease, and save unannounced entry for real emergencies like a burst pipe.
Can a Michigan landlord change the locks or shut off utilities?
No. Only a court officer can remove a tenant after an eviction judgment. Changing locks, removing belongings, or cutting off utilities to force a tenant out is an illegal self-help eviction, and the tenant can sue for damages under MCL 600.2918. If a tenant stops paying, use the court process. Our Michigan eviction process guide walks through it step by step.
Retaliation is also off-limits. Under MCL 600.5720, a tenant can raise retaliation as a defense if you start an eviction within 90 days after they report code violations, file a complaint, or otherwise exercise legal rights, and the burden shifts to you to show the eviction wasn't retaliatory.
Are there limits on late fees in Michigan?
Michigan has no statute setting a specific dollar or percentage cap on residential late fees. A late fee needs to be written into the lease, and the Legislature's Practical Guide notes that courts may apply a general standard of reasonableness to fees like late rent charges. Keep it moderate, state it clearly in the lease, and apply it the same way to every tenant.
What fair housing rules apply to Michigan landlords?
The federal Fair Housing Act and Michigan's Elliott-Larsen Civil Rights Act both apply. According to Michigan Legal Help, Michigan landlords cannot discriminate based on:
- Race, color, religion, or national origin
- Sex, sexual orientation, or gender identity or expression
- Age
- Familial status or marital status
- Disability
- Source of income (see below)
Michigan's 2023 amendments to Elliott-Larsen expressly added sexual orientation and gender identity or expression, as announced by the Governor's office.
Source of income is the newest protection. Starting April 2, 2025, landlords with five or more rental units cannot discriminate based on a tenant's lawful source of income, including Housing Choice Vouchers (Section 8), Social Security, SSI, veterans' benefits, and other public assistance. Michigan Legal Help states that landlords with four or fewer units are exempt from this specific rule. Even if you're under the threshold, a blanket "no Section 8" policy is a bad idea. Many Detroit owners do well with voucher tenants; our Section 8 landlord guide for Detroit covers how the program works.
Assistance animals are not pets under fair housing law, so pet fees and bans don't apply to them. The Michigan Department of Civil Rights handles state housing discrimination complaints.
What extra rules apply to Detroit rentals?
Detroit layers its own requirements on top of state law. The city requires landlords to register rental properties and pass a city inspection to get a certificate of compliance, and on older homes that inspection includes a check for chipping paint and bare soil. A Detroit rental without a certificate can create real problems when you try to collect rent or evict.
We cover the details, costs, and timeline in our guide to Detroit rental registration and the certificate of compliance.
How does a property manager keep you compliant?
Most landlord legal trouble in Michigan is a missed 14-day notice, a checklist that never went out, an itemized list mailed on day 34, or an out-of-state lease template. A good manager builds each step into the routine, from Michigan-specific leases to move-out lists mailed on time and city compliance kept current. Here's what a property manager actually does day to day.
Great Lakes Property Management Group is a licensed Michigan real estate brokerage based in Detroit, managing rentals since 2006. Our management fee is 10% of the rent we actually collect, and tenant placement is one month's rent (see how that compares). If you'd rather hand off the compliance work, see how our full-service Detroit property management works, or contact us to talk through your property.
Frequently asked questions
What is the maximum security deposit in Michigan?
One and a half times the monthly rent. Refundable fees and prepaid rent beyond the first period count toward that limit.
How long does a Michigan landlord have to return a security deposit?
30 days after the tenancy ends. Within that time, the landlord must return the full deposit or mail an itemized list of damages with any remaining balance, provided the tenant gave a forwarding address in writing within 4 days of moving out.
What can a Michigan landlord deduct from a security deposit?
Only unpaid rent, unpaid utility bills, and damage beyond reasonable wear and tear.
What happens if a Michigan landlord doesn't follow the security deposit law?
The landlord can waive the damages claimed and be liable for double the amount of the deposit retained. The landlord can still sue separately for unpaid rent or damage.
Can Michigan landlords refuse Section 8 tenants?
Since April 2, 2025, landlords with five or more rental units cannot discriminate based on source of income, which includes Housing Choice Vouchers. Landlords with four or fewer units are exempt from that specific rule, though other fair housing laws still apply.