What Is A Security Deposit And Why Landlords In Ghana Should Demand It?

In any rental situation, your landlord will probably ask you to pay an extra amount above your first monthly rent payment. This is to cover any unpaid rent or damages you might cause during your tenancy period. It protects both of you: you get your place to make memories in, and they get some peace of mind knowing there's a backup plan in case of oops moments. 

What is the Security Deposit in a Tenancy Agreement?

The Security Deposit in a tenancy agreement is defined as any deposit of money or property to secure performance by the tenant under a rental agreement. It can either be refundable or nonrefundable, depending on the terms of the lease agreement. Usually, the security deposit is intended as a measure of security for the landlord, and can also be used to pay for damages or lost property. A landlord is permitted to request a security deposit of any size, but in practice, they are equal to one month's rent. If your landlord in Ghana asks for more than a single month's rent and keeps your deposit for more than six months, the landlord is in breach of the Rent Act.

How Does a Security Deposit Work? 

Security deposits are paid before moving in or taking possession of the rental property and these deposits are typically the same amount as the monthly rent. This isn't just another month's rent, it is like a handshake with your landlord for trusting you with the space, and this deposit is a promise to take good care of it. It is also a bit of a safety net that might be used toward any repairs or replacement of appliances in a rental unit if the damages result from the actions of the renter.

Let's say a renter breaks a window (hopefully not!) or causes permanent damage to the floors, walls, or infrastructure of the property, then the security deposit could be used to fix things up, leaving you free to focus on more important matters. Typically, if the rental property is in good condition and without the need for repair when the tenant moves out, the security deposit may be refunded to them.

Why Landlords In Ghana Should Demand It?

1. Protection Against Damage to the Property

In Ghana, many rental properties are not insured, so, to protect a rental property in Accra, there has to be a security deposit. It is there in case you are unable to pay the water bill for one month, or maybe there is damage to walls, floors, appliances, or other fixtures in the property. Yes, the security deposit may not be adequate for certain damages but the reality is that it provides landlords with a financial cushion. For a renter to have access to the security deposit after the tenancy, the rental property must be in good standing without any defaults in the rental agreement.

2. Compensation for Unpaid Rent

Unlike some countries, evicting tenants in Ghana who fall behind on rent can be a slow process here. Imagine, a tenant default on a rent payment due to a surprise medical bill. With no fancy fast-track evictions, the security deposit would be a temporary source of compensation for the landlord. That's why a security deposit is particularly important in Ghana, where there is a lack of robust legal mechanisms for landlords to quickly evict tenants who fail to pay rent. It is a system born out of necessity, a way to protect both landlords and tenants in Ghana.

3. Encourage Responsible Tenancy

Tenants in Ghana might think that a security deposit sounds so strict, but think of it as a little nudge to take good care of the place. The requirement for a security deposit can encourage tenants to be more responsible and take better care of the property. That's the beauty of it! It encourages a tenant to be a responsible tenant, someone who keeps the place sparkling and avoids any preventable mishaps. So, the security deposit becomes a silent motivator, a way to turn your new apartment into a cherished home, one you'll both be proud of.

4. Screening Potential Tenants

Finding the right tenant for your Accra apartment isn't about a good first impression. The security deposit is a key player too. It is not only about protecting the rental space, it is a secret tenant approval. A renter willing to put down a deposit is showing commitment, someone who sees the space as a home, not just a temporary abode. It isn't a perfect system, but that security deposit is a window into a potential tenant's soul, a way to find someone who would use and cherish the property in Accra just as much as you did.

5. Negotiation Tool

A security deposit can serve as a negotiation tool during the lease agreement process. Landlords may be willing to offer concessions or negotiate on other terms of the lease, such as rent amount or lease duration, in exchange for a higher security deposit. A higher deposit could be a key to unlocking some concessions. Maybe a slightly lower rent, or a more flexible lease term. As a tenant, if you negotiate well you could use the security deposit to turn the lease agreement into a win-win situation.

FAQs 

Is a security deposit refundable?

As long as you pay rent on time and take good care of the place, it'll be happily refunded when you move out. In many cases, deposits are refundable if the tenant meets all agreement conditions. However, they may be forfeited for early lease termination or property damage. Some businesses charge non-refundable deposits to cover costs or discourage cancellations. 

What to do if the landlord doesn't return the security deposit in Ghana?

If your landlord in Ghana does not return your security deposit, you can take several steps to try to get it back. These include reviewing your lease agreement, sending a formal request for the deposit's return, considering mediation through the Rent Control Department, filing a complaint with the Rent Control Department, exploring the option of small claims court, and seeking legal advice if necessary. Remember to keep detailed records of all interactions with your landlord and related documents.

What is the maximum security deposit?

It typically ranges from one to two months' rent but can vary. If a tenant is asked to pay a deposit that exceeds the allowable amount, they should contact the Rent Control Department. Landlords are generally required to return the security deposit minus any deductions for unpaid rent or property damage at the end of the lease term. 

How long does a landlord have to return a security deposit?

The time frame for landlords to return security deposits to tenants after move-out ranges from 14 to 30 days. Tenants should keep documentation related to the security deposit and communicate with their landlord in writing regarding its return.