What is a common lease term regarding security deposits?

A common lease term regarding security deposits is that security deposits must be held in a separate, interest-bearing account. This practice ensures that the tenant's money is protected and not commingled with the landlord's personal funds. Additionally, holding the deposit in a separate account can provide transparency and accountability, allowing tenants to feel secure that their deposit is being managed properly.

In many jurisdictions, laws require that security deposits be kept in a separate account and may even stipulate that the account be interest-bearing, meaning that any interest accrued often belongs to the tenant. This measure not only helps in fostering trust between the landlord and tenant but also encourages proper handling of the deposit throughout the lease term.

This approach contrasts with other options that may not universally apply or meet legal requirements in many areas, making it an important aspect of lease agreements.