Cal. Civ. Code § 1
A lessor of residential real property, containing 25 or more units in either a single building or a complex of buildings located on contiguous parcels of real property, who receives a security deposit from a lessee to secure the payment of rent or compensation for damage to property shall pay interest to the lessee computed from the date of the deposit at a rate equal to the interest paid by the largest commercial bank, as measured by total assets, having its main banking premises in this State on minimum deposit passbook savings accounts as of December 31 of the calendar year immediately preceding the inception of the rental agreement on any deposit held by the lessor for more than 6 months
Operative Text
A lessor of residential real property, containing 25 or more units in either a single building or a complex of buildings located on contiguous parcels of real property, who receives a security deposit from a lessee to secure the payment of rent or compensation for damage to property shall pay interest to the lessee computed from the date of the deposit at a rate equal to the interest paid by the largest commercial bank, as measured by total assets, having its main banking premises in this State on minimum deposit passbook savings accounts as of December 31 of the calendar year immediately preceding the inception of the rental agreement on any deposit held by the lessor for more than 6 months.
Under 765 Ill. Comp. Stat. 715, landlords who own or manage residential buildings of 25 or more units and collect security deposits are required to pay interest on those deposits once they have been held for more than six months. The interest rate is tied to the rate paid by Illinois's largest commercial bank (by total assets) on minimum passbook savings accounts as of December 31 of the year before the lease began. This rule applies whether the units are in a single building or spread across contiguous parcels that together total 25 or more units.
Plain English — not legal advice.
Operators of residential properties covered by 765 Ill. Comp. Stat. 715 — those with 25 or more units in a single building or on contiguous parcels — generally track the date each security deposit was received and calculate accruing interest once the deposit has been held beyond six months. Compliant operators identify the applicable interest rate by checking what Illinois's largest commercial bank (by total assets) paid on minimum passbook savings accounts as of December 31 of the year preceding the lease start date. Maintaining clear records of deposit dates, applicable rates, and interest payments helps demonstrate ongoing compliance with this provision.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
Under 765 Ill. Comp. Stat. 715, tenants living in qualifying buildings of 25 or more units have a right to receive interest on their security deposit after it has been held for more than six months. If a landlord has not paid the required interest, tenants may have grounds to raise that failure as part of a dispute over the deposit, file a complaint with a local housing authority, or reach out to a tenant-rights organization for guidance on available remedies. Keeping copies of the original lease, any deposit receipts, and any communications about the deposit can be useful when pursuing this type of claim.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated September 18, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
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