Security Deposit — Kaution for Rental Housing in Germany

Kaution — Security Deposit for Rental Housing in Germany

Kaution is a security deposit that landlords collect to cover potential damages or outstanding rent. The rules are regulated by §551 BGB and are favorable to tenants — it's worth knowing them, as the Kaution is often the largest one-time expense when renting.

How much is the security deposit?

Maximum three months' net rent (Kaltmiete — excluding Nebenkosten). Landlords cannot demand more.

• Net rent €800 → max. Kaution €2,400
• Net rent €600 → max. Kaution €1,800

You have the right to pay in three installments

The law (§551 para. 2 BGB) guarantees you the right to spread the Kaution over three equal monthly installments. The first is due at the start of the lease, the next two in the following months. Any clause in the contract prohibiting installments is invalid — even if you sign it.

Forms of security deposit

1. Barkaution — payment into a separate Kautionskonto (see below).
2. Mietkautionsbürgschaft (bank or insurance guarantee) — you don't block cash, but pay an annual premium (approx. 5% of the Kaution amount annually) indefinitely.
3. Verpfändetes Mietkautionssparbuch — you open a savings account and assign it to the landlord.
4. Elternbürgschaft — parental guarantee.

Where the security deposit goes

The landlord has a legal obligation to hold the Kaution in a separate account (Kautionskonto), kept separate from their own assets and bearing interest. Any interest accrued (Kautionszinsen) belongs to you. This means that if the landlord goes bankrupt, the Kaution is not part of the bankruptcy estate.

Handover protocol — your proof

When taking over and returning the apartment, draw up a Wohnungsübergabeprotokoll: apartment condition, defects, meter readings. Take photos. This is crucial evidence if the landlord wants to deduct alleged damages from the Kaution.

When you get your deposit back

• After the lease ends and the apartment is returned.
• Timeline usually 3–6 months; the landlord may retain a reasonable portion until the annual Nebenkosten settlement.
• Deductions only for documented damages exceeding normal wear and tear (vertragsgemäße Abnutzung). Normal usage marks are not subject to deduction.

Details on return and deadlines: Security Deposit Return (Kautionsrückzahlung).

Common mistakes — watch out

• Never pay the Kaution before viewing the apartment and signing the rental agreement — this is a classic scam pattern when apartment hunting.
• Always get a payment receipt.
• If the landlord doesn't return the Kaution: send a written demand with a deadline, then contact Mieterverein/Mieterbund or court (Mahnverfahren).