---
title: "Rent-to-own agreements: What happens to the deposit if the purchase is cancelled?"
author: "Esther Asmundsson"
authorUrl: "https://bofrid.se/en/articles/authors/EstherAsmundsson"
datePublished: "2026-08-04T14:16:19.278Z"
dateModified: "2026-08-04T14:48:29Z"
description: "Unsure about your deposit? We explain the rules for rent-to-own agreements and when you have the right to get your money back if the deal falls through."
keywords: ["rent-to-own deposit", "getting deposit back rent-to-own", "rent-to-own property", "deposit rules rent-to-own", "cancelling rent-to-own"]
categories: ["Guider", "Hyresvärd"]
canonical: "https://bofrid.se/en/articles/rent-to-own-agreements-what-happens-to-the-deposit-if-the-purchase-is"
language: "en"
image: "https://bofrid.media/cms/53360f6e528a750d22dc95b294bed2d6d40917b9.png"
---

# Rent-to-own agreements: What happens to the deposit if the purchase is cancelled?

## Can you get your deposit back for a rent-to-own agreement if the deal is cancelled?

In a rent-to-own agreement, the deposit serves as security for the landlord during the rental period preceding the final purchase. Whether or not you get your deposit back is primarily regulated by the specific contract drawn up between the parties, but with support from Lag (2026:843) om hyrköp av bostad (the Act on Rent-to-Own Housing). If the purchase is cancelled, the right to a refund depends on the terms of the contract and the reason why the purchase is not completed. If the tenant chooses to withdraw from the purchase despite all conditions in the contract being met, the deposit is often considered a forfeited amount or damages for the lost sale. If, conversely, it is the landlord who cannot deliver the property according to the agreement, the main rule is that the deposit must be refunded in full.

### What does Lag (2026:843) om hyrköp av bostad state?

Lag (2026:843) om hyrköp av bostad (the Act on Rent-to-Own Housing) provides the framework for how these types of contracts should be handled in Sweden. The law emphasizes the importance of clarity in contracts regarding what constitutes valid grounds for cancelling a purchase. It is important to understand that a deposit is not automatically refundable, especially if there has been damage to the property during the rental period or if the tenant's actions have caused the landlord financial loss. According to legal practice and the principles discussed in [Lag (2026:843) om hyrköp av bostad](https://bofrid.se/artiklar/vad-hander-med-din-hyra-vid-hyrkop-enligt-den-nya-lagen), the contract should always specify how settlement is handled in the event of an early termination.

### When can the landlord withhold the deposit?

The landlord has the right to withhold all or parts of the deposit if there are unpaid debts or if the condition of the property has deteriorated beyond normal wear and tear. To get a clearer picture of what can be deducted, read more here: [What can the landlord deduct from the deposit?](https://bofrid.se/en/articles/rental-deposit-sweden-rules-amount-2026). In rent-to-own agreements, the stakes are often higher than in standard rentals, which means that disputes regarding the deposit can become financially significant. It is of the utmost importance to document the condition of the property upon moving in to avoid arbitrary deductions.

| Situation | Right to refund | Comment |
| :--- | :--- | :--- |
| Purchase cancelled by buyer without valid reason | Usually no | Deposit is forfeited as damages |
| Purchase cancelled by seller | Yes, full amount | Seller is the breaching party |
| Property is damaged at move-out | No, deduction is made | Damages are deducted according to inspection report |
| Agreement on cancellation | According to contract | Follow what is stated in your written contract |

### The importance of a correct contract

When entering into a rent-to-own agreement, it is crucial that there are no ambiguities regarding the obligation to refund. Many problems arise when the contract is too vaguely formulated. For those who want to understand the legal aspects of moving in and entering into contracts, we recommend the article [The Cohabitation Act and property purchases: How to write a legally correct contract when moving in](https://bofrid.se/en/articles/sweden-s-sambolagen-and-home-buying-how-to-draft-a-legally-correct-cohabitation-agreement-for-20). By regulating the deposit separately from the rent payments, you reduce the risk of confusion.

### Tax consequences of a cancelled rent-to-own agreement

Cancelling a rent-to-own agreement not only has civil law consequences through lost deposits but can also entail tax effects for both parties. According to the Inkomstskattelagen (1999:1229) (the Income Tax Act), rent-to-own is considered a rental relationship until such time as ownership is formally transferred. If the buyer loses their deposit as damages for breach of contract, the question of the right to deduct arises. For a private individual, losses due to breach of contract are generally not tax-deductible in the tax return, which means that the lost deposit becomes a net cost without tax compensation.

For the landlord, other rules apply. If the deposit is forfeited because the buyer pulls out, the amount may in some cases be considered taxable income in business operations. The landlord should therefore be careful to distinguish between a deposit intended as security for rent and funds that constitute part of the purchase price. Skatteverket (the Swedish Tax Agency) emphasizes the importance of bookkeeping clearly reflecting the nature of the transaction. In cases of uncertainty regarding how a forfeited deposit should be reported, a tax lawyer should be consulted, as incorrect handling can lead to tax surcharges. It is therefore of the utmost importance that the rent-to-own agreement is designed so that it is clear whether paid funds are to be considered rent or an advance on the purchase price, as this governs the tax treatment in the event of a cancellation of the deal.

## Frequently asked questions

**Is the deposit in a rent-to-own agreement the same thing as a down payment?**
No, a deposit is security for the rental period, while a down payment is a partial payment of the purchase price itself. In rent-to-own agreements, these can sometimes overlap, but it must be specified in the contract.

**What happens if I cannot get a loan when the purchase is to be completed?**
This depends on the circumstances in the contract. If clauses regarding a mortgage promise (lånelöfte) are missing, it may be counted as a breach of contract, which could lead to you losing the deposit.

**Can the landlord keep the deposit to cover future loss of rent?**
Only if it is explicitly stated in the contract or if it can be proven that the tenant's breach of contract directly caused the landlord financial damage.

**Where can I find legal help if we disagree?**
If you cannot reach a settlement, it is a matter for the court or legal experts. Also, check your insurance coverage via [Which insurance is needed for rent-to-own housing](https://bofrid.se/artiklar/vilken-forsakring-behovs-for-hyrkop-av-bostad) to see if legal protection (rättsskydd) is included.

*This text provides general information and does not constitute legal advice.*