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Connecticut apartment landlords now know the interest they will have to pay on tenants’ security deposits.

The state Division of Banks announced that the 2021 deposit index has been set at 0.08 percent. The deposit index is used to determine the interest rates required by statute to be paid for various accounts like rental security deposits, mortgage escrow accounts and others

The index is based on average rates paid on savings deposits and must be determined annually by the state banking commissioner.

Connecticut landlords and tenants have rights and responsibilities when it comes to collecting, holding, and returning rental security deposits. For example, landlords are required to return the security deposits of their tenants with interest or give tenants written notice of damages being claimed within thirty days of when tenants move. On the other hand, a tenant could forfeit their interest for any months that they are more than 10 days late on their rent. When they move out, tenants must provide written notice of a forwarding address where the landlord may send their security deposit with interest.

The announcement from the Division of Banks means the 2021 interest rate for rental security deposits is 0.08 percent, down from 0.15 percent from last year’s rate, while the interest rate on mortgage escrow accounts will be 0.1 percent.