Wilkie May & Tuckwood
We hold a deposit equivalent to at least one month’s rent. This will only be released back to the tenant when the following conditions are met:
• Tenancy terminated
• Premises in an acceptable condition and all keys returned
• Final accounts settled
For items requiring reinstatement, repair or cleaning the tenant will cover the cost. This will normally come from the deposit held by us.
Deposits and their status – Know where you stand
It is absolutely essential for agents, landlords & tenants to appreciate the status of dilapidation deposits, or bonds as they are sometimes referred to, and thus help prevent conflict concerning any of its retention at the end of a tenancy.
Firstly the money belongs to the tenant, and if we hold the deposit we as agent are holding it in trust on their behalf as stakeholder.
As it is the tenant’s money we must account for it and any deductions properly. If we hold the deposit as Stakeholder, we need both the landlord and tenant’s consent when apportioning its return at the end of a tenancy.
A stakeholder cannot release money to the landlord without the authority of the tenant
Until both parties agreed any deductions the money is not to be touched and will remain where it has been protected, even if it has to go to Court for a decision to be made.
Whilst the agent acts for the landlord, they make a professional assessment to the best of their ability. This does not mean favouring the landlord if it compromises a lawful point, or is unfair or unreasonable to the tenant.
Tenancy Deposit Protection came into force on April 6 and requires landlords and agents to protect deposits in a Government authorised scheme.
This will safeguard the deposit and offer free independent adjudication in the event of a dispute.
Tenancy Deposit Protection will apply to all assured shorthold tenancies (ASTs) in England and Wales where the landlord takes a deposit.
The vast majority of tenancies are ASTs.
The landlord will be able to choose between two types of scheme:
• A custodial scheme, whereby the landlord pays the deposit into a custodial scheme. At the end of the tenancy, if the landlord and tenant agree on how the deposit should be divided, the scheme will return the money to the tenant and landlord/agent as appropriate.
• An insurance-based scheme, where the landlord or agent will hold the deposit, pay a fee, and any failure on his part to repay it to the tenant will be covered by the scheme's insurance arrangements.
In the case of a dispute over how much of the deposit the tenant is entitled to, the landlord and tenant can use the alternative dispute resolution service (ADR), provided by the schemes, to resolve the dispute.
The three schemes are:
• The Deposit Protection Service (The DPS) - the only custodial deposit protection scheme – is free to use and open to all Landlords and Letting Agents. The service is funded entirely from the interest earned from deposits held. Landlords and Letting Agents will be able to register and make transactions online. Paper forms will also be available should internet access be an issue. The scheme will be supported by a dedicated call centre and an independent dispute resolution service. For more information, visit www.depositprotection.com or call 0870 707 1 707
• Tenancy Deposit Solutions Ltd (TDSL) is a partnership between the National Landlords Association and Hamilton Fraser Insurance. This insurance-based tenancy deposit protection scheme enables landlords, either directly or through agents, to hold deposits. Letting agents can also join the scheme. For more information, visit www.mydeposits.co.uk
• The Tenancy Deposit Scheme (TDS) is an insurance-backed deposit protection and dispute resolution scheme run by The Dispute Service that builds on a scheme established in 2003 to provide dispute resolution and complaints handling for the lettings industry. The new scheme enables letting agents and landlords to hold deposits. For more information, visit www.tds.gb.com or call 0845 226 7837.
Where we deal with the deposit monies these will be transfered over to the Deposit Protection Service and held there until the end of the Tenancy. Upon carrying out a termination check we will inform the tenant of any deductions to be made from their deposit and MUST obtain their written consent to make these deductions. As your agents we will try and mediate between both parties to come to an amicable solution for both parties. If an agreement cannot be made we then transfer the case to the adjudicators who will then make the decision as to what, if any, deductions should be made.