What type of account can a landlord hold a tenant's deposit in according to state regulations?

According to state regulations, a landlord can hold a tenant's deposit in a non-interest-bearing account, which is typically the preferred method for managing security deposits. This type of account simplifies the regulatory requirements and ensures that the tenant's funds are not subject to fluctuations in interest rates, making it easier to calculate and return the exact deposit amount at the end of the lease.

While landlords may choose to use interest-bearing accounts in some cases, doing so often involves additional legal requirements regarding how the interest is managed and whether it must be returned to the tenant, which can complicate the process. Joint accounts with tenants or corporate accounts are not standard practices for holding security deposits and may pose additional complications in terms of access and accountability. Therefore, maintaining the deposit in a non-interest-bearing account is straightforward and aligns with standard regulations designed to protect tenants' funds.