Which of the following describes the purpose of a security deposit?

The purpose of a security deposit is primarily to cover potential damages caused by the tenant. When a tenant moves into a rental property, the landlord usually collects a security deposit as a form of financial protection against various risks related to tenancy, such as unpaid rent or physical damage to the property beyond normal wear and tear. This deposit is held in trust and is typically refundable at the end of the lease term, provided the property is returned in good condition.

The security deposit serves as a safeguard for landlords, allowing them to recoup costs associated with any damages or unpaid obligations that may arise during the rental period. It's an essential part of the landlord-tenant relationship, ensuring that there is a financial deterrent against neglect or misuse of the rented space. Upon the conclusion of the lease, if no damages are present and the tenant has fulfilled all obligations, the deposit is returned in full, which emphasizes its role as a security measure rather than an upfront fee for rental agreements or payments.