When renting a home in Norway, the landlord will normally ask for financial security in case rent is not paid or other costs arise during the tenancy.
This security can be provided through a deposit account or a deposit guarantee. Both options can protect the landlord, but they work differently for the tenant.
The main difference is simple:
With a deposit account, the tenant places their own money in a blocked account.
With a deposit guarantee, a third-party provider, such as Keyhole, guarantees an agreed amount on the tenant’s behalf.
The right option depends on the tenant’s finances, the landlord’s requirements and what both parties agree to in the tenancy agreement.
In short:
- Deposit account: the tenant’s own money is held blocked, and whatever is not used is returned.
- Deposit guarantee: a third party provides the security, and the tenant pays for it.
- The amount paid for a guarantee is normally not returned.
- The tenant remains responsible for valid claims either way.
- Deposit and guarantee combined cannot exceed six months’ rent.
- The landlord decides which form of security is required.
What is a deposit account?
A deposit account is a separate, blocked account established in the tenant’s name.
The tenant transfers the agreed deposit into the account, where it remains throughout the tenancy. Neither the tenant nor the landlord can freely access the money.
The deposit can provide security for claims connected to the tenancy, such as:
- Unpaid rent
- Damage beyond normal wear and tear
- Costs related to eviction
- Other valid claims under the tenancy agreement
The landlord must cover the cost of opening the account. The deposit cannot be transferred to the landlord’s private or business account.
At the end of the tenancy, the money is distributed according to the parties’ agreement or the applicable legal process. Any remaining deposit belongs to the tenant.
What is a deposit guarantee?
A deposit guarantee replaces the cash deposit with a guarantee from a third-party provider, such as Keyhole.
Instead of placing a large amount of money in a blocked account, the tenant pays for the guarantee. The provider then gives the landlord financial security for an agreed amount.
This allows the tenant to keep their savings available for other moving costs, such as furniture, transport or the first month’s rent.
Unlike a cash deposit, the amount paid for the guarantee is normally not returned at the end of the tenancy.
The guarantee also does not remove the tenant’s financial responsibility. If the provider pays a valid claim to the landlord, the provider may require the tenant to repay that amount.
The main differences
Both options give the landlord security, and both require the landlord to accept them. Here are the differences point by point.
Payment at move-in
Deposit account: the tenant transfers the full deposit.
Deposit guarantee: the tenant pays for the guarantee.
Where is the money?
Deposit account: in a blocked account in the tenant’s name.
Deposit guarantee: with the tenant, because the provider supplies the security.
Who provides the security?
Deposit account: the tenant’s own deposited money.
Deposit guarantee: a third-party guarantee provider.
Does the tenant get the payment back?
Deposit account: the remaining deposit is returned, normally with interest.
Deposit guarantee: the amount paid for the guarantee is normally not returned.
Is the tenant still responsible for claims?
Deposit account: yes, valid claims can be deducted from the deposit.
Deposit guarantee: yes, the tenant may have to repay the provider.
Does the landlord have to approve it?
Deposit account: yes.
Deposit guarantee: yes.
Main advantage
Deposit account: the tenant keeps ownership of the money.
Deposit guarantee: the tenant avoids tying up a large amount.
Worth considering
Deposit account: requires more money available at move-in.
Deposit guarantee: the tenant pays for the flexibility the guarantee gives.
When can a deposit account be a good choice?
A deposit account may suit a tenant who:
- Has enough savings to pay the full deposit
- Prefers a refundable deposit rather than paying for a guarantee
- Wants to receive the remaining amount back after moving out
- Wants to earn interest on the deposited money
The main consideration is that a substantial amount can remain unavailable for the entire tenancy. With a deposit equal to three months’ rent, that can be a significant part of a tenant’s savings.
That money still belongs to the tenant, but it cannot be used freely while the tenancy continues.
When can a deposit guarantee be a good choice?
A deposit guarantee may suit a tenant who:
- Does not want to lock away a large part of their savings
- Needs more financial flexibility when covering moving costs
- Prefers to pay for a guarantee instead of placing the full deposit in an account
- Meets the guarantee provider’s approval requirements
A guarantee can make it easier to manage the costs of moving and allows the tenant to keep their savings available.
However, it is important to understand that the guarantee does not protect the tenant from future claims. The tenant remains responsible for unpaid rent, damage or other valid costs connected to the tenancy.
What does the landlord need to consider?
For the landlord, both options can provide suitable security when they are set up correctly.
Before accepting a deposit guarantee, the landlord should check:
- Who provides the guarantee
- The amount covered
- Which claims are covered
- How and when the guarantee is closed
- How a claim must be submitted
- Which documentation may be required
- What happens if the tenancy is extended
The chosen form of security should be clearly included in the tenancy agreement.
A landlord cannot require the tenant to pay a cash deposit directly into the landlord’s own account. If the parties choose a cash deposit, it must be placed in a legal, blocked deposit account in the tenant’s name.
How much security can the landlord require?
The deposit and guarantee combined cannot exceed six months’ rent.
This means the parties can agree on a deposit account, a guarantee or, in some cases, a combination of the two, as long as the total security remains within the legal limit.
The amount and type of security should be agreed before the tenant makes any payment.
Keyhole Secure or Keyhole Guarantee?
Keyhole offers both alternatives in Norway.
Keyhole Secure
Keyhole Secure is a digital deposit account for tenants who prefer the traditional cash-deposit model.
The money is held in a separate, blocked account in the tenant’s name. The tenant keeps ownership of the deposit and earns interest while the money is held in the account.
Keyhole Secure can also onboard international tenants without requiring a Norwegian national identity number, D-number or BankID first. Identity verification is still required.
Keyhole Guarantee
Keyhole Guarantee allows an approved tenant to replace the cash deposit with a deposit guarantee.
The tenant pays for the guarantee instead of locking the full deposit amount in an account. The landlord receives security for the agreed amount, while the tenant keeps more money available at move-in.
The guarantee is issued through Nordic Guarantee. Keyhole is a registered insurance agency supervised by the Danish Financial Supervisory Authority (Finanstilsynet). The deposit guarantee itself is not an insurance policy. It is a guarantee that replaces a cash deposit.
The price depends on the rent and the deposit amount. Ask your landlord or Keyhole what applies to your tenancy.
Keyhole Guarantee requires approval. The landlord must be a Keyhole partner and invite the tenant to apply.
If Keyhole pays a valid claim under the guarantee, the tenant remains responsible for repaying that amount.
Which option is better?
Neither option is automatically better for everyone.
A deposit account requires the tenant to have the full amount available at move-in. A deposit guarantee provides greater financial flexibility because the tenant does not need to lock away a large cash amount.
Before deciding, the tenant should ask:
- Can I comfortably place the full deposit in a blocked account?
- How long do I expect to rent the property?
- What will the guarantee cost during that period?
- Is keeping my savings available more important to me?
- Do I understand what happens if the landlord submits a claim?
The landlord should also review the guarantee terms and make sure the chosen solution provides suitable security.
Frequently asked questions
Is a deposit guarantee the same as a deposit?
No. A deposit is the tenant’s own money held in a blocked account. A guarantee is a promise from a third-party provider to cover eligible claims up to an agreed amount.
Do I get back the amount I pay for a deposit guarantee?
Normally, no. The amount is the payment for the guarantee and allows you to keep your savings available instead of placing the full deposit in an account. For Keyhole Guarantee, premiums are paid in advance and are not refunded.
Does a deposit guarantee mean I do not have to pay for damage?
No. The guarantee does not remove the tenant’s responsibility. If the provider pays the landlord, the tenant may be required to repay the provider.
Who pays to open a deposit account?
The landlord must cover the cost of establishing a legal deposit account.
Can the landlord decide which option to use?
The landlord and tenant must agree on the security. A deposit guarantee cannot replace an agreed cash deposit unless the landlord accepts it.
Can the landlord ask for both?
A deposit and guarantee may be combined, but the total amount cannot exceed six months’ rent.
Find the right deposit solution
Keyhole Secure and Keyhole Guarantee offer two different ways to establish security for a tenancy.
Choose Keyhole Secure if you prefer to place the money in a blocked account and receive the remaining deposit back after the tenancy.
Choose Keyhole Guarantee if you want to keep your savings available and pay for a guarantee instead of locking away the full deposit amount.
Are you a landlord?
Book a free, no-obligation conversation with Emma to see how you can offer both options to your tenants.
Are you a tenant?
Ask your landlord whether Keyhole Secure or Keyhole Guarantee is available for your tenancy.
