Deposit, security deposit, and guarantees in temporary rentals
When signing a temporary rental agreement, it is common for the landlord to request certain financial guarantees to ensure compliance with the terms of the contract. The most common include the security deposit, an additional deposit, and other financial guarantees.
Although these concepts are often mentioned together, they do not mean exactly the same thing and have different legal implications. Understanding what a security deposit is, how it differs from an additional deposit, and what guarantees may be requested in a temporary rental can help avoid confusion before signing the contract.
In this article, we explain how these guarantees work in Spain and which aspects should be reviewed in a seasonal rental agreement.
What are guarantees in a rental agreement?
Guarantees in a rental agreement are financial mechanisms that protect the landlord against possible breaches of contract by the tenant. These guarantees may cover situations such as:
- Non-payment of rent
- Damage to the property
- Breach of contract terms
- Early termination of the contract
In temporary rentals, it is common for landlords to request more than one guarantee, especially when the stay is short or the tenant does not usually reside in the country.
What is the security deposit in a temporary rental?
The security deposit is a mandatory guarantee regulated by the Urban Leasing Law (LAU). It is an amount of money that the tenant pays to the landlord when signing the contract and that must be returned at the end of the stay if there is no damage or outstanding debt. According to Spanish regulations:
- In standard residential rentals, the security deposit is usually equivalent to one month’s rent
- In rentals for purposes other than permanent residence, such as temporary rentals, the amount may be different
The security deposit is usually registered with regional government agencies responsible for managing these guarantees.
What is the additional deposit?
The additional deposit is a financial guarantee that the landlord may request in addition to the legal security deposit. Unlike the security deposit, this additional deposit:
- Is not regulated by law with a fixed amount
- Is freely agreed upon between landlord and tenant
- Does not always need to be registered with public agencies
The purpose of this deposit is to cover additional risks, especially in situations such as:
- Short stays
- International tenants
- Fully furnished properties
The amount of the additional deposit may vary, although it is often equivalent to one or several months’ rent.
Other guarantees landlords may request
In addition to the security deposit and additional deposit, there are other ways to guarantee compliance with the rental agreement.
Bank guarantee
In some cases, the landlord may request a bank guarantee, which is a guarantee issued by a financial institution. This guarantee allows the landlord to claim the guaranteed amount if the tenant breaches the contract.
Rent default insurance
Some landlords use insurance policies that cover possible unpaid rent. In some cases, the tenant must meet certain requirements in order to obtain this type of insurance.
Advance rent payments
In temporary rentals, it is also relatively common for landlords to request several months of rent in advance.
This practice is usually applied when the contract duration is short.
When is the security deposit or additional deposit returned?
The return of the security deposit or additional deposit usually takes place when the rental agreement ends and the tenant returns the property in good condition. Before returning the guarantee, the landlord may check:
- That there is no damage to the property
- That there are no outstanding utility bills
- That the rent has been paid correctly until the end of the contract
If there are no issues, the security deposit must be returned within the period established by law or by the contract. In Spain, the usual period is up to 30 days from the end of the contract, although this may vary depending on regional regulations.
What to review in the contract before paying a guarantee
Before paying any amount of money when signing a temporary rental agreement, it is advisable to review several important aspects.
Total amount of the guarantees
The contract should clearly specify how much corresponds to the legal security deposit and how much corresponds to the additional deposit.
Return conditions
It is important to check under which circumstances the landlord may retain part of the guarantee.
Furniture inventory
If the property is furnished, it is advisable to verify that there is a detailed inventory of furniture and appliances.
Responsibility for utilities
Some contracts establish that certain expenses may be deducted from the security deposit if there are outstanding bills.
Frequently asked questions about deposits and guarantees in temporary rentals
Is it mandatory to pay a security deposit in a temporary rental?
Yes. The security deposit is a mandatory guarantee in rental agreements regulated by the Urban Leasing Law.
Can the landlord request more than one guarantee?
Yes. In addition to the legal security deposit, the landlord may request additional deposits or other guarantees if both parties agree to them in the contract.
How much money can a landlord request as a guarantee?
It depends on the type of rental and what the parties agree upon. In temporary rentals, it is relatively common for landlords to request several months of guarantees between the security deposit and additional deposits.
When must the security deposit be returned?
The security deposit is usually returned when the contract ends and the tenant returns the property without damage or outstanding debts.
Can the landlord keep the security deposit?
The landlord may only retain it fully or partially if there is damage to the property, unpaid bills, or breach of contract.
