Can a deposit be automatically forfeited for a violation of a lease provision?

No. The Colorado Security Deposit Act C.R.S., 38-12-103 states that any lease provision that automatically results in the forfeiture of a resident’s deposit is void. This doesn’t mean that deposit money cannot be withheld for violations of lease provisions that result in monetary damage to the community or landlord. Rather, all money must be accounted for and the resident must receive proper notice stating the exact reasons (general classifications will not do) regarding the disposition of deposit money. If the charges against the deposit do not equal the total amount deposited, then the balance must be returned with the disposition report accounting for the deposit and explaining the exact reasons why any money was applied. Remember there is a 30 day requirement to account for and return the balance if any to the tenant unless the lease states otherwise, but not to exceed 60 days. For more information, see the firm’s Security Deposit Briefing Paper located in the resource center. The Briefing paper is available to firm clients only.