Your Landlord Owes You Interest on the Deposit, Whether They Actually Invested It or Not
Under Section 551, Paragraph 3 of the Bürgerliches Gesetzbuch (BGB), your landlord is legally required to invest your rental deposit, your Kaution, in a way that earns interest, specifically at the rate customary for savings deposits with a three-month notice period, and separately from their own personal assets. The money itself, and any interest it earns, genuinely belongs to you, the tenant, not your landlord, and this interest compounds year over year, meaning your deposit's total value effectively grows a little each year it sits there. A genuinely important detail confirmed by the Bundesgerichtshof (BGH): this interest obligation is fault-independent, it applies to your landlord regardless of whether they actually invested the deposit the way they were supposed to, if they simply left it in a low-interest or non-interest-bearing account instead, you're still entitled to the interest calculated at the customary rate for three-month notice savings deposits, based on the Bundesbank's own published statistics. Given how small this can look on an individual-year basis, it's genuinely easy to overlook, but multiple independent calculator tools exist specifically because enough tenants have found this worth actually claiming when their deposit is returned.
The Official Rule
Assuming your rental deposit just sits untouched until move-out, with no further entitlement attached, is a genuinely common but incomplete picture, German law specifically requires your landlord to grow that money on your behalf.
Your landlord is legally required to invest your deposit in a way that earns interest, at a specific, defined rate. kautionskasse.de’s guidance on deposit interest calculation confirms Section 551, Paragraph 3 BGB obligates your landlord to invest your Kaution at the rate customary for savings deposits with a three-month notice period, and to keep this investment separate from their own personal assets, this isn’t a discretionary courtesy, it’s a specific legal requirement.
| Aspect | Detail |
|---|---|
| Legal basis | §551 Abs. 3 BGB |
| Required rate | Customary rate for 3-month-notice savings deposits |
| Who the interest belongs to | The tenant, not the landlord |
| Compounding | Yes, year over year, growing the deposit's total value |
| If landlord didn't actually invest it properly | Interest is still owed, obligation is fault-independent (per BGH) |
The deposit itself, and every bit of interest it earns, genuinely belongs to you, not your landlord. kautionszinsrechner.de’s reproduction of § 551 BGB confirms this directly, the deposited money serves as security for the landlord, but it belongs to the tenant, and the accrued interest specifically belongs to the tenant too, this is why the investment has to be kept separate from the landlord’s own assets in the first place.
A genuinely important detail, confirmed at the highest level, protects you even if your landlord didn’t follow the rules properly. ruv.de’s tenant guidance on Kaution interest confirms the Bundesgerichtshof has established that this interest obligation is fault-independent, the standard applied is the customary rate for three-month notice savings deposits, and this applies regardless of whether your landlord actually invested the deposit as required, if they simply left it sitting in a low- or non-interest-bearing account instead, you’re still entitled to the interest you would have earned at the proper rate.
This interest genuinely compounds over time, which is worth knowing if your tenancy runs for several years. Under Section 551, Paragraph 3 BGB, the interest remains on the deposit account and generates compound interest in following years, your deposit’s total value effectively grows a little more each year it sits with your landlord, this is exactly why multiple independent calculator tools exist specifically to help tenants work out what they’re actually owed.
What Real People Say
Tenants who first learned about Kautionszinsen describe genuine surprise that this entitlement existed at all, several specifically mention assuming their deposit simply sat untouched with no further obligation on their landlord’s part, only to discover a real, calculable interest entitlement attached the entire time.
Tenants whose landlords never actually invested the deposit properly describe relief at learning the fault-independent nature of this obligation, several specifically recommend calculating the customary rate using the Bundesbank’s published statistics or an independent calculator tool, rather than assuming they’re owed nothing simply because their landlord didn’t follow the investment requirement.
Step by Step
- Understand your landlord is legally required to invest your deposit at the customary 3-month-notice savings rate, under §551 Abs. 3 BGB.
- Know this interest genuinely belongs to you, not your landlord, and compounds year over year.
- Don’t assume you’re owed nothing if your landlord didn’t actually invest it properly, the obligation is fault-independent per the BGH.
- Use an independent Kautionszinsrechner or the Bundesbank’s published rates to calculate what you’re actually owed.
- Raise this specifically when your deposit is returned, particularly if your tenancy ran for several years, given how the interest compounds.
Compliance Note
This page explains the general legal framework for Kautionszinsen in Germany, current as of mid-2026. It is not legal advice, and specific calculations depend on your tenancy’s exact terms and duration. Confirm your specific situation directly with a Mietrecht attorney or your local Mieterverein.
FAQ & Common Pitfalls
Does our landlord actually have to invest our deposit somewhere, or can they just hold onto the cash?
They're legally required to invest it, Section 551, Paragraph 3 BGB specifically obligates your landlord to invest your deposit in a way that earns interest, at the rate customary for savings deposits with a three-month notice period, and kept separate from their own personal assets. This isn't optional or a matter of landlord preference.
Our landlord never mentioned investing our deposit anywhere. Are we still owed interest?
Yes, genuinely, this is a specifically important detail the Bundesgerichtshof has confirmed: the interest obligation is fault-independent, it applies regardless of whether your landlord actually invested the deposit as required. If they simply left it in a low-interest or non-interest-bearing account, you're still entitled to interest calculated at the customary rate for three-month notice savings deposits.
How is this interest actually calculated if our landlord didn't specify a rate?
It's based on the average interest rates for three-month notice savings deposits, as published in the Bundesbank's own statistics, this gives an objective, external benchmark rather than something your landlord gets to set arbitrarily. Independent calculator tools exist specifically to help tenants work out this figure using these published rates.
Is this actually worth pursuing given how small the amount might be for just one year?
It genuinely can add up more than you'd expect, since the interest compounds year over year under Section 551 Paragraph 3 BGB, meaning your deposit's effective value grows a little more each year it sits with your landlord. The existence of multiple independent, dedicated calculator tools for exactly this purpose suggests enough tenants find it genuinely worth calculating and claiming when their deposit is returned.