Michigan Security Deposit Maximum: 1 1/2 Months' Rent

A Michigan security deposit “shall not exceed 1 1/2 months' rent” (MCL 554.602). The cap is measured against everything the statute calls a security deposit, and MCL 554.601(d) defines that term broadly: required rent prepayments beyond the first full rental period, rent above the term's average, and other money returnable on condition of the unit's return all count. This article describes the statute; it is not legal advice.

What the cap says

MCL 554.602 says a landlord “may require a security deposit for each rental unit” and that the deposit shall not exceed 1 1/2 months' rent. That is a ceiling, not a target. Multiply one month's rent by 1.5:

A tenant's agreement to pay more does not change this: MCL 554.606 says the Act's requirements “may not be waived by the parties to a rental agreement except as specifically provided herein.”

What counts toward the cap

Under 554.601(d), a security deposit is “a deposit, in any amount, paid by the tenant to the landlord or the landlord's agent” to be held for the term or part of it. It also includes:

• “any required prepayment of rent other than the first full rental period of the lease agreement”;
• “any sum required to be paid as rent in any rental period in excess of the average rent for the term”;
• “any other amount of money or property returnable to the tenant on condition of return of the rental unit by the tenant in condition as required by the rental agreement.”

The section names only two exclusions: an amount paid for an option to purchase under a lease with an option to purchase (unless the intent was to evade the Act), and a cooperative housing association membership purchase.

Worked examples

1. Plain deposit

Rent is $1,100, so the cap is $1,650. A $1,650 deposit is at the cap; $1,800 is $150 over.

2. Add-ons

Rent is $1,100. The lease requires a $1,000 deposit, a $400 pet deposit refunded if the unit comes back in the condition the lease requires, and last month's rent of $1,100 at signing.

The cap is $1,650, so this lease is $850 over. If last month's rent is collected, everything else counted together can be at most $550 ($1,650 − $1,100).

3. Uneven rent

A 12-month lease charges $1,000 for months 1–11 and $1,600 for month 12. The average rent for the term is $12,600 ÷ 12 = $1,050, so month 12 is $550 above it. We read that $550 as a sum “in excess of the average rent”, so it counts. The statute text gives no formula and does not say whether the cap uses the $1,000 stated rent or the $1,050 average. On $1,000 the cap is $1,500, and a $1,000 deposit plus $550 is $1,550, which is $50 over. On $1,050 the cap is $1,575, and it fits. Stay under the lower figure and ask an attorney.

What the statute says about the amount, and what it leaves out

Says: a ceiling of 1 1/2 months' rent for each rental unit; a broad definition; no waiver; and that the Attorney General or any affected individual may bring an action to enforce the Act (MCL 554.615).

Does not say (in the files we use):

• what a month's rent is when rent is weekly or irregular;
• whether a later rent increase lets a landlord raise a deposit already collected;
• any separate cap or exemption for pets, furnished units or cleaning charges;
• any penalty inside 554.602 itself;
• whether a charge that is never returnable is a deposit, beyond the definition above.

For those, the answer is not in the statute text; ask a Michigan attorney.

Check your lease today

1. List every amount the lease requires besides rent for the first full rental period, including any rental period whose rent is above the average rent for the term.
2. Mark each one that is returnable, is prepaid rent, or is rent above that average.
3. Add the marked amounts and compare them with 1.5 times one month's rent.

Common mistakes

• Counting only the line labelled security deposit.
• Treating prepaid last month's rent as outside the cap.
• Adding a refundable pet or similar amount on top of a full-size deposit.
• Relying on the tenant's signature to exceed the cap.
• Treating the cap as the only rule: MCL 554.603 also conditions requiring a deposit on a written notice, and MCL 554.607 limits what the deposit may be used for.

Checked against the text published on legislature.mi.gov on 5 October 2026.

Sources

• MCL 554.601 — Michigan Legislature, Michigan Compiled Laws
• MCL 554.602 — Michigan Legislature, Michigan Compiled Laws
• MCL 554.603 — Michigan Legislature, Michigan Compiled Laws
• MCL 554.606 — Michigan Legislature, Michigan Compiled Laws
• MCL 554.607 — Michigan Legislature, Michigan Compiled Laws
• MCL 554.615 — Michigan Legislature, Michigan Compiled Laws

Related guides

• Michigan Security Deposit: The 30-Day Notice of Damages
• Michigan Security Deposit Written Notice: 14-Day Rule, MCL 554.603
• Michigan Landlord Inventory Checklist Requirements (MCL 554.608)
• Michigan 45-Day Deposit Rule: Sue or Return, and Double Damages
• Michigan Deposit Refunds by Direct Deposit: The 2026 Change
• Michigan 7-Day Demand for Possession for Unpaid Rent
• Michigan Month-to-Month Notice to Quit: MCL 554.134 Explained
• Michigan Eviction Process: Summary Proceedings, Step by Step
• Michigan Landlord Lockout and Utility Shutoff: MCL 600.2918
• Michigan Lease Clauses Landlords Cannot Use (Truth in Renting)
• Michigan Source-of-Income Law and the 5-Unit Exemption

Informational only, not legal advice. Statute text checked against the Michigan Compiled Laws (MCL 554.131 to 554.139, 554.601 to 554.616, 554.631 to 554.641 and 600.2918, 600.5701 to 600.5759) as published at legislature.mi.gov on October 5, 2026. Statutes change and a court may read them differently than a summary does; for a dispute, an eviction or anything expensive to get wrong, talk to a Michigan landlord-tenant attorney.