subsection, the tenant may give written notice to that person that such
security money plus an amount representing interest at the rate of seven percent per annum be
applied on account of rent payment or payments due or to become due from the tenant, and
thereafter the tenant shall be without obligation to make any further security deposit and the
person receiving the money so deposited shall not be entitled to make further demand for a
security deposit. However, in the case of a failure by the person receiving the security deposit to
pay the annual interest or to provide the annual notice at the time of the annual interest payment,
if the annual notice is not also serving as a notice of change of account or institution, before the
tenant may apply the security deposit plus interest on account of the rent payment or payments
due or to become due on the part of the tenant, the tenant shall first give that person a written
notice of his failure and shall allow that person 30 days from the mailing date or hand delivery of
this notice to comply with the annual interest payment or annual notice, or both.
d. The provisions of this section requiring that the security advanced be deposited or invested
in a money market fund, or in an interest bearing account in a State or federally chartered bank,
savings bank or savings and loan association shall not apply to any security advanced on a
contract, lease or license agreement for the seasonal use or rental of real property. For purposes
of this paragraph "seasonal use or rental" means use or rental for a term of not more than 125
consecutive days for residential purposes by a person having a permanent place of residence
elsewhere. "Seasonal use or rental" does not mean use or rental of living quarters for seasonal,
temporary or