In contrast, in New York City, and in the counties of Westchester, Nassau and Rockland and other areas in New York State subject to the Rent Control or Rent Stabilization Laws, the landlord of the regulated unit can hold a security deposit not greater than one month's current legal rent. Typically, a rent security deposit will be authorized by a clause in the first, or vacancy, lease, and paid at the time the tenant signs the lease or takes occupancy. The landlord may omit a provision to hold a rent security deposit, or agree to hold an amount less that a full month's rent. For unregulated tenants, a security deposit lease clause could be added to a renewal of a lease. For rent stabilized tenants, however, the NYC Rent Stabilization Code prohibits the addition of such a clause if the tenant's first lease did not contain a clause authorizing a security deposit.
Landlords sometimes collect a rent security deposit without giving a lease.
Since the tenant would then have no documentation of the deposit, the tenant should take care to get a receipt clearly showing that a deposit was given. Even without a lease, the rent security deposit provisions of the GOL apply. A lease renewal usually extends the landlord's right to a security deposit contained in the first lease, and may provide for an increase in the rent security deposit to the level of the new monthly rent. For regulated units, where the landlord is limited to a security deposit of no more than one month's rent, in calculating the new rent security deposit requested, accrued interest if not distributed to the tenant, should be credited. Interest Payments Interest earned on the tenants account must be at the prevailing rate for similar types of accounts in the bank's geographic area.