30 September 2008

Tenants are still losing thousands of pounds in deposits each month by not sticking to tenancy agreements, according to mydeposits.co.uk, a Government-authorised tenancy deposit protection scheme.

The average deposit protected at mydeposits is now £771 and with 12 per cent of all disputes in July 2008 finding in favour of the landlord or agent, it is estimated that tenants could be losing in excess of £15,000 per month by not keeping to the terms of their tenancy agreements.*

Mandatory tenancy deposit protection (TDP) rules were introduced to ensure a fair and balanced way for landlords and tenants to resolve any disputes at the end of a tenancy. Since April 2007, landlords have to give reasons and evidence (if called upon) if they withhold some or all of the deposit. As long as tenants read and understand their responsibilities in their tenancy agreements, landlords are not permitted to unfairly withhold their cash.

mydeposits is helping tenants by providing concrete advice on how to keep their deposits:

TOP TIPS FOR TENANTS: how to keep your deposit

1. What would your mother say? Keep it clean!
   You are most likely to lose your deposit in order to cover cleaning costs. This doesn’t come cheap either. Cleaning bills account for 38 per cent of all deposit disputes. So avoid being stung for the cost of a professional clean by keeping the property in a reasonable condition throughout the tenancy. Little and often makes it bearable.
2. Treat it like your own.
   If you cause damage to the property, furniture or white goods you can expect to cough up. The repair costs will be deducted from your deposit. If you damage something by accident, give your landlord a ring and be honest. And if it’s not too expensive, it might be cheaper to get it fixed or even replace it.
3. Money, money, money.
   Like the rest of us, landlords have got to pay their bills too. Falling into rent arrears is a sure-fire way of losing your deposit. Paying rent on time should be a high priority but if things do go wrong, give your landlord plenty of notice and see if you can arrange a suitable repayment plan. Most landlords will be flexible to a degree.
4. Signing on the dotted line matters.
   The contract you sign is a legally binding document enforceable through the courts. Read it carefully before signing and make sure you stick to the agreed terms. For example, if you agree to give 30 days’ notice before ending the tenancy, you run the risk of losing your deposit if you don’t do as the contract dictates.
5. Make sure your deposit is protected.
   The deposit protection law was designed to protect tenants from the small number of rogue landlords who unfairly withhold deposits: make sure your deposit is protected. Your landlord must show you proof of protection within 14 days of receiving the cash and they face stiff penalties if they don’t.

David Salusbury, Chairman, mydeposits.co.uk, said both tenants and landlords need to be aware of their rights and responsibilities:

"Most tenancies end amicably but it is a two-way relationship. Most landlords behave fairly and only withhold deposits where necessary. But it’s also incumbent on tenants to ensure they treat the property with respect and pay their rent on time. If tenants act according to the rules laid out in their agreements, a landlord has no right to withhold their deposit.

"The onus remains firmly on the landlord to comply with the law but it makes sense for tenants to ensure their deposit is protected by asking to see confirmation. Landlords must provide proof of protection within 14 days of receiving the deposit."

* Methodology: mydeposits.co.uk protected 28,730 deposits worth £22,173,089 in July 2008. Therefore, the average deposit amount protected in the scheme was £771.

197 adjudications were made in July, with 20 upheld in full for landlords and agents. Therefore, 20 tenants losing their deposit equates to a loss of £15,420. 

* The professional bodies are:

• Association of Residential Letting Agents
• National Association of Estate Agents
• National Approved Lettings Scheme
• Royal Institute of Chartered Surveyors

For further information and case studies of tenants, landlords and letting agents who have been using mydeposits.co.uk, please contact:

Steven Hilton
mydeposits.co.uk
Email:

steven.hilton@landlords.org.uk
Tel: 020 7840 8906
Mob: 07508 031 084

Notes to editors:

About mydeposits.co.uk:

Mydeposits is the trading name of Tenancy Deposit Solutions Limited, a company jointly owned by the National Landlords Association and HFIS plc T/A Hamilton Fraser Insurance (the Scheme Administrator) to deliver an insurance-backed tenancy deposit protection scheme under contract from Communities & Local Government. Landlords wishing to use this scheme are required to register with the Scheme Administrator. They can find out more and register by visiting www.mydeposits.co.uk. Registered members of the Scheme are able to protect and unprotect deposits at the beginning and end of tenancies. Fees are tax-deductible. In the event of a dispute at the end of the tenancy agreement, both parties are offered access to alternative dispute resolution (ADR). This procedure will be evidence-based, relying on documentation and records.

About Hamilton Fraser Insurance:

Hamilton Fraser Insurance is the trading name of HFIS plc, a long-established insurance broker, authorised and regulated by the Financial Services Authority. Hamilton Fraser provides insurance services to clients throughout the UK and is located in New Barnet, Hertfordshire. Hamilton Fraser is a major player in the highly specialised property insurance sector, and offers a tailored product to both residential landlords and managing agents. The NLA and Hamilton Fraser have a long-standing relationship, with Hamilton Fraser offering its range of Landlord Solutions insurance products to members of the NLA.

About the National Landlords Association:

The National Landlords Association (NLA) exists to protect and promote the interests of private residential landlords. With almost 20,000 individual landlords from around the United Kingdom and over 90 local authority associates, it provides a comprehensive range of benefits and services to its members and strives to raise standards in rented accommodation. The NLA seeks to safeguard landlords’ legitimate interests by making their collective voice heard by local and central government and the media. The NLA seeks a fair legislative and regulatory environment for the private-rented sector while aiming to ensure that landlords are aware of their statutory rights and responsibilities.