Landlords who allow pets sometimes require tenants to pay a separate deposit to cover any damages caused by the pet. In some states this is legal; in others, it's not. Regardless of state law, under federal law, landlords may never charge a pet fee or deposit to disabled tenants who have a service or assistance animal.
All states allow landlords to collect a security deposit when tenants move in, and hold it until the tenants leave. The general purpose of the deposit is to ensure that a landlord has money for repairing damage caused by tenants and covering unpaid rent. States often regulate security deposits: For example, many states have laws limiting security deposit amounts and imposing deadlines for returning security deposits. Some states also dictate how landlords can use security deposits.
In some states, such as California, landlords may not charge more than a specified amount (such as one or two months' rent) as a deposit. When a landlord collects more than one type of deposit, such as a security deposit and a separate pet deposit, the total of the deposits cannot exceed the state limit—regardless of what the landlord calls the various deposits (pet fee, cleaning fee, or whatever).
A few states specifically allow landlords to charge an additional pet deposit (usually capped at a certain amount) to cover any damage caused by the pet. Depending on the state, these deposits might truly be deposits, because landlords must refund whatever amount they don't apply toward repairs. Otherwise, the money collected is a non-refundable pet fee.
In all states, it is illegal under federal law (the Fair Housing Act and Fair Housing Amendments Act, among others) to charge tenants with disabilities a pet deposit or pet fee for service or emotional support animals.
Pet deposits aren't always the best option for landlords: When landlords collect pet deposits, state laws sometimes prohibit them from using the security deposit for repairing pet-related damages. For example, if replacing dog-urine-stained carpeting throughout the apartment costs $1500, but the landlord collected only $200 as a designated pet deposit, the landlord probably can't dip into the security deposit to cover the remaining $1300. The opposite might also be true: When tenants trash an apartment, the landlord cannot use any of the pet deposit to clean up after the tenant. For example, if a tenant's dog is well-behaved, but the tenant trashes the apartment to the tune of $1500 in repairs, the landlord can't use any of the $150 pet deposit to clean up after the tenant.
Landlords who are concerned about pet damage are usually better off charging a higher rent (if not prohibited by rent control or stabilization) or requiring a higher security deposit. Before deciding to collect a higher security deposit, though, landlords should make sure that they don't exceed any state law limits on security deposits. A local landlord-tenant attorney can help landlords determine how to legally collect enough of a deposit or fee to cover any pet-damage expenses.