Residential-Landlord Tenant Act—Generally.  The Residential Landlord-Tenant Act (RLTA) regulates the creation of residential tenancies and the relationship between landlords and tenants of residential dwelling units.  The RLTA establishes rights and duties of both tenants and landlords, procedures for the parties to enforce their rights, and remedies for violations of the RLTA.
 
Deposits and Fees.  Under the RLTA, a landlord may collect deposits, fees, and other amounts before, or at the outset of, a tenancy such as:

• a tenant screening fee, subject to provisions governing the amount that may be charged and the information that must be provided to the tenant;
• a deposit or fee to hold the dwelling unit after the tenant has been offered the unit and is no greater than 25 percent of the first month's rent—if the tenant moves in, the landlord must credit the fee or deposit to the first month's rent or the security deposit;
• a damage or security deposit, to cover any damage caused to the property by the tenant in excess of normal wear and tear;  
• a nonrefundable fee, including a cleaning fee that is not for normal cleaning; and
• first and last month's rent.

 
Security Deposit.  Under the RLTA, a landlord may collect a damage or security deposit to cover any damage caused to the property by the tenant in excess of normal wear and tear resulting from ordinary use, which must be placed in a trust account.  To collect such a deposit, the rental agreement must be in writing, and the landlord must provide the tenant at the commencement of the tenancy a written checklist or statement specifically describing the condition and cleanliness of, or existing damages to, the premises and furnishings, including walls, floors, countertops, carpets, drapes, furniture, and appliances. 
 
Within 21 days after the termination of the rental agreement and vacation of the premises, or after abandonment by the tenant, the landlord must give a full and specific statement of the basis for retaining any of the deposit and pay any refund owed to the tenant.  Any portion of the deposit may not be withheld because of wear resulting from ordinary use of the premises.  
 
Installment Payments.  Upon written request from a tenant and if the total amount of the deposits and nonrefundable fees exceed 25 percent of the first full month's rent and payment of the last month's rent, a landlord must permit the tenant to pay any deposits, nonrefundable fees, and last month's rent in installments, as follows:

• in all cases where premises are rented for a specified time, three months or longer, the tenant may elect to pay in three consecutive and equal monthly installments, at the inception of the tenancy; and
• in all other cases, the tenant may elect to pay in two consecutive and equal monthly installments, at the inception of the tenancy.

A landlord may offer the tenant the option of paying a fee in lieu of a full security deposit.  The landlord may not use the fact a prospective tenant opts to pay the fee in lieu of a security deposit as a criterion in determining whether to rent to that tenant.  Any landlord who offers the fee in lieu of the security deposit must offer the choice of the fee to every prospective tenant whose application for occupancy has been approved, without regard to certain protected class statuses as well as income, household size, and credit score.  Any tenant that agrees to pay a fee in lieu of a security deposit may opt out of the continuing fee and instead pay a security deposit that is otherwise in effect for the tenant's unit at the time the tenant chooses to opt out of the fee.   
 
When a landlord offers the tenant the choice of paying a fee in lieu of the security deposit, the landlord must disclose to the tenant in writing:

• the terms of any insurance coverage purchased by the landlord for unpaid rent and unit damage paid for by the fees in lieu of the security deposit, including any coverage cap amounts and excluded coverage costs; and
• that the payment of the fee does not preclude the insurer or the landlord from filing an action against the tenant to recover for damage to the property for which the tenant is responsible.

 
Any fee in lieu of a security deposit may be:

• entirely or partially nonrefundable as long as such terms are disclosed in the lease and acknowledged by the tenant;
• used by the landlord to purchase insurance coverage for unpaid rent or unit damage, provided the landlord does not charge the tenant a fee that is more than the reasonable cost of obtaining and administering such coverage—by July 1, 2024, all such insurance policies must be from insurance companies authorized by the Insurance Commissioner to transact insurance in Washington; and
• a recurring monthly fee or payable upon any schedule and in any amount the landlord and tenant choose, provided the first month's fee is a nonrefundable fee as contemplated under RLTA provisions addressing installment payments.  

 
Any fee in lieu of a security deposit does not constitute rent as defined under the RLTA, or preclude the landlord from filing an action against the tenant to recover unpaid fees.
 
Any fee in lieu of a security deposit may not be considered by a court, arbitrator, mediator, or other dispute resolution adjudicator to be a security deposit.  Any action taken against a tenant to recover for costs of repairs must begin within one year of the termination of the rental agreement or the tenant's abandonment of the premises and must comply with certain deposit requirements for the documentation of damage, standards for normal wear and tear, or other standards of proof required to make a claim against a deposit.