State Specific Question About: NEW JERSEY (NJ) According to the NJ. Security Deposit Act, is a landlord REQUIRED to allow tenants to utilize their security deposit to get current on back rent?

If the landlord has failed to follow the requirements in regard to a tenants security deposit under NJSA 46:8-19, then after the 30 day notice period has expired, the tenant can “Demand” in writing that the security deposit be applied to rent due

Note: the landlord cannot require another deposit as long as the tenant remains in possession, Frontenac assoc. v. Fauerbach, 148 NJ Super 376

ONLY IF YOU HAVE FAILED as the Landlord to correctly handle the deposit money ! BUT you would have 30 days to fix any mistake you made.

IF the landlord has no more then one & one 1/2 moths rent as security ... if the landlord has deposited the money in correct bank account & has informed the tenant in writing where the funds are - and the landlord provides a yearly statement on anniversary of lease or end of year then NO .....

unless written in the lease ( as mine are ) the interest will accrue till lease termination ..other wise the tenant can apply the YEARLY interest toward the rent.

(which in most cases in less then a dollar ) LOL

Do you have a statement in your lease that the security deposit may no be applied to any portion of the rent. If not you should.

I do not believe the landlord after the 30 day notice requirement from the date they received the tenant’s deposit has additional 30 days to cure major infractions under NJSA 46:8-19 when notified by the tenant

Cite: Princeton Hill Assoc. v. Lynch (App. Div. 1990)

Also: posted below is the exact statute relevant to the question

46:18-19(c)(5)

“If the person receiving a security deposit fails to invest or deposit the security money in the

manner required under this section or to provide the notice or pay the interest to the tenant as

required under this subsection, the tenant may give written notice to that person that such

security money plus an amount representing interest at the rate of seven percent per annum be

applied on account of rent payment or payments due or to become due from the tenant, and

thereafter the tenant shall be without obligation to make any further security deposit and the

person receiving the money so deposited shall not be entitled to make further demand for a

security deposit. However, in the case of a failure by the person receiving the security deposit to

pay the annual interest or to provide the annual notice at the time of the annual interest payment,

if the annual notice is not also serving as a notice of change of account or institution, before the

tenant may apply the security deposit plus interest on account of the rent payment or payments

due or to become due on the part of the tenant, the tenant shall first give that person a written

notice of his failure and shall allow that person 30 days from the mailing date or hand delivery of

this notice to comply with the annual interest payment or annual notice, or both.”

The additional 30 days seems to apply only to annual interest/notice/ serving as notice of change of account or institution

Vs., the court in Lynch which did state the landlord is allowed to present any evidence concerning any acceptable excuses, as a basis for an equitable relaxation of the smilingly mandatory language of the statute like being hospitalize but the court does state the remedy available is actually “Mandatory Remedy”

Yes you are correct - in your 30 day facts ...

however if the security deposit money is handled correctly at the time of the initial rental - then there is no issue on the Landlords part and the tenant has no grounds to use the security to pay the rent.