Security Deposit Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Security Deposit, written in plain English, along with examples of how it is used.

What is Security Deposit?

(n) Security deposit is the amount collected before commencement of any activity to recover the possible loss if any caused to the owner while occurrence of such activity. For example security deposit collected from tenant can be used to recover the loss or damage of the property by tenants mishandling of property or failure to pay rent.