It is used for any damages done to the property during the tenant's occupancy. A tenant cannot use the security deposit as rent payment. A security deposit differs from a deposit given before lease signing to remove the property off the market. If the lease is signed the initial deposit is kept as security deposit. According to the Pennsylvania Security Deposit Law, a landlord can charge an amount up to or equal to two months' rent as security deposit in the first year of a lease.
Some landlords consider half of it as the last month's rent.
After the first year, the landlord can only hold a security deposit equal to one month's rent. No last month's rent should be held by landlord after the first year. At the beginning of the third year the deposit must be placed in an interest-bearing escrow account. At the end of the third year and every year thereafter, the landlord must remit the interest to the tenant. If possible, have the landlord inspect the property with you.