The Rental Deposit Dilemma

Is letting your property a professional business?

Inviting an unknown person to sign your lease agreement and to take occupation of your property is a risk in itself. Unless you have professional guidance it can be very tricky dealing with difficult tenants. The penalties for non-compliance are crippling, so Landlords need to be very careful in avoiding fines. For starters if you don’t place the deposit in an approved deposit scheme you could face a fine of 3 times the deposit plus the deposit itself. Let’s first look at the typical problem facing many tenants.

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Paying a second deposit, don’t we all face this issue?

Moving home is one of the biggest stress causing factors. It’s made more challenging when you are faced with moving costs and those incidental extras that you face when you move in. Paying your deposit is a large cost, especially when your existing Landlord hasn’t refunded your deposit. What are you expected to do if you want to secure your new rental lease and you need the cash?

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When Landlords claim for damages how protected are you?

How do you feel at the end of your tenancy, when the Landlord claims for excessive damage costs? What about when you are held responsible for a list of items not caused by you? How can you avoid a dispute which often ends up unresolved? This is a real puzzle and best resolved by an impartial party.

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Are you protected against bogus claims?

If you don’t settle a claim from your Landlord this could result in a bad reference for you. It’s often easier to settle and move on, as legal battles are costly. Would it not be ideal to have the Law on your side, so that disputes are handled expeditiously and in a fair manner?  We must remember that your Landlord’s reference is crucial, for your next lease. It’s important to ensure this is taken care of.

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What concerns do Landlords have regarding deposits?

The law currently permits a deposit which is capped at 5 weeks rent. The main concern facing Landlords is that the deposit is very often not sufficient to cover damages. How are they supposed to recover costs and effect repairs when the tenant has moved out and has no further interest. There are other losses which often occur, let’s explore this further.

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What can damages include?

The obvious items are furniture, fittings and items that were removed or missing. There is also the neglect to garden maintenance. Unless this is restored, your home will not be appealing to many who love a pleasant outdoor space. One must not forget about unpaid rental and the stress that it bares? How can this be recovered during a dispute without seeking help? When your tenant disputes your claim, this can delay closure and the necessary repairs to your property. Landlords and Tenants currently wait up to 2 months on average to access any funds. It’s no wonder that over £5.2 Billion is locked up in deposit schemes. It’s safe to say that deposits are slow and outdated. It’s clear that the rental market needs an impartial official who is empowered to resolve disputes.

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Is there is a solution currently in place?

There most certainly is and our associate company that specialises in this area has saved tenants over £ 10 million over 3 years, in deposit fees. Furthermore, disputes have been handled and much time has been saved for those involved.

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Is there a cost?

For Landlords the service is free. The Tenant has an option to replace the traditional deposit with a once off check-in fee of 1 week’s rent plus VAT. This unlocks double the normal security for the Landlord. This means 10 weeks rent  instead of 5 weeks. It will also cover unpaid rental which can be claimed at check –out time. A Government – backed Adjudicator is assigned to resolve disputes, quickly and fairly. Once charges have been agreed the claim will be paid in 10 days. It’s time to let go of the old dilemma and bring in the new.

Feel free to talk to me for professional guidance by contacting me on 07729623650 or send me an email at alan.hicks@kwuk.com

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And if you're looking to avoid any issues in the first place, why not have a look at some of our other articles regarding rental properties including: How To Ensure You Get Your Security Deposit Back Easily or the Ultimate Guide On What To Look For In Your New Rental.