Thank you for the information. It was useful!
Also, yes he did place the security in an interest bearing account and it was stated in the lease. He provided a copy of that.
My husband and I rented a house for two years. My landlord told us he would not be renewing the lease because he was moving back in. (We found out days later that the house is actually being torn down.) We moved out. He is asking us to sign a letter allowing him to keep part of the deposit...