New tenancy deposit law

Oh good....... Another load of government red-tape & bureaucracy.   

Paul, as you know, I am no fan of red tape, but the principle of this idea is good.  Thousands of people get their deposits kept for no good reason, and it is usually the poor (students etc) who get scammed by this because they cannot afford legal action against the landlord.  The only problem I see is that rents (in student towns especially)  are likely to rise as a result of this.

Vicky

The only problem I see is that rents (in student towns especially)  are likely to rise as a result of this.

Vicky

But that shouldn't be the case because if someone leaves the property as they received it then the deposit should go back to them...fair and square. Of course if there is damage or other issues then the deposit should be used for that. Why would rent need to be raised? The problem is that the LL's think its their free right to just take the money.

b/c there's two seperate schemes.. one where the landlord actually hands the deposit to a holding company.  at the end of the tenancy- if there's no dispute- this holding compnay releases the deposit (with interest!) to the tenant.

the second option is for the landlord to hold the deposit, but for them to pay money to an insurance scheme which the tenant would then claim if the landlord didn't release their money at the end of the scheme.  this would probably be an extra on top of the current fees.

another question- my boyfriend rents out his house.  if he signs a new lease with someone after 6-April, he'll have to do this.  i've tried to find the name of the "holding company" but can't.  any insight?

the second option is for the landlord to hold the deposit, but for them to pay money to an insurance scheme which the tenant would then claim if the landlord didn't release their money at the end of the scheme.  this would probably be an extra on top of the current fees.

Yes but I guess the point I was trying to get across is if the flipping landlord (sorry, I am tainted big time) was honest to begin with then there wouldn't be an issue for insurance.

But that shouldn't be the case because if someone leaves the property as they received it then the deposit should go back to them...fair and square. Of course if there is damage or other issues then the deposit should be used for that. Why would rent need to be raised? The problem is that the LL's think its their free right to just take the money.

I think rents will rise because scummy landlords will realise that they are going to lose out by not being able to steal deposits, so will raise rents to compensate.

The other side of the coin is that bad tenants won't be able to skip out owing a months rent and leaving damages, so it works both ways.

Vicky

Paul, as you know, I am no fan of red tape, but the principle of this idea is good. 

I think this is one of those things which sounds very fair in principle, but I can't help wondering whether the implementation will actually improve matters.   Sure, there are bad landlords and there are bad tenants.    The comments seem to suggest that under this new law a dispute would end up in court ultimately.   So what will change other than there being an extra layer of red-tape, which may well slow the whole process down?

I think that because the money is held by an independent organisation the landlord may be less inclined to try to pull a fast one.


Vicky

Could be, although I agree with you that landlords may well increase rents because they won't have that deposit money to use for the duration.

Could be, although I agree with you that landlords may well increase rents because they won't have that deposit money to use for the duration.

The landlords shouldn't be able to "use the money". The security deposit should go into a separate interest bearing account and at the end of the tenancy if all is ok then the renter should get everything back (including interest) if all is in good order. If not, then a reasonable amount should be agreed upon through a moderator because you can't usually trust the LL nor the letting agency.   

The point is that the tenancy deposit scheme will be empowered to decide who gets what in the event of a dispute, hence legal action is less likely.

Meggles, I believe there are several such companies, try googling "tenancy deposit scheme."

It sounds like a good idea to me, we got ripped off by our last landlord, they kept our deposit, and from the sounds of it were going to keep it no matter what, we couldnt afford a solicitor, and they charged us for wear and tear, so-called minor infractions of the lease, and for supposedly not giving them enough notice that we were leaving, when they knew long before we left that we were going (unfortunately the notice was not in writing).

We feel they were definitely in the wrong, and they breached the contract themselves shortly after we moved in, by barging into the house with no notice, just knocked on the door and came into the house, when they were supposed to give 72 hours notice. They also left us with a newborn and no heating in our house for 3 weeks. Again when it came time to fix the heating no notice was given, the guy fixing it just showed up one day after we'd given up hope of getting it fixed and had decided after that incident to not renew our lease with them.

In the end it caused a lot of problems, we really needed our deposit back, we couldnt afford to have them keep it, but were given no choice. There needs to be some sort of protection for bogus claims against the tenants.

We now are in a house we love and hope to stay in long-term, but the landlord is a bit odd, he has all these demands and wanted a 3-month inspection, which the letting agent cant be @rsed to arrange after I called them a few different times, so that better not come back to bite us as we need to renew our lease in June. We plan to try to negotiate and clarify the terms of the lease when we ask to renew though...he says we are responsible for all mechanical and electrical upkeep...and we dont know if that means he expects us to fix the heating etc if it broke or what (sorry waay off topic!).