Relating to certain deposits or fees required to be provided by a tenant or prospective tenant in connection with a residential lease.

HB 3497 clarifies what constitutes a "security deposit" under Texas law for residential leases. It defines security deposits to include upfront or recurring fees covering future damages or lease violations (Section 92.102(2)), but explicitly excludes application fees and fees based on a tenant's eviction or credit history (Section 92.102(3)). The law directly affects tenants and landlords by standardizing deposit rules and limiting fees they can charge. It applies only to new or renewed leases entered into on or after its effective date (September 1, 2025), not to existing leases.