New rules over holding deposits are set to come into force in conjunction with the ban on fees.
The draft Tenants Fees Bill, as proposed, will require holding deposits to be refunded to tenants within seven days of the tenancy agreement being completed, or within 15 days of the deposit being taken if the agreement is not completed for reasons within the landlord’s control.
The holding deposit will not have to be refunded if the tenant has no Right to Rent under the Immigration Act, if the landlord (or their agent) did not know this at the time of accepting the deposit.
The holding deposit will also not have to be refunded if the tenant fails to enter the tenancy agreement, or if the tenant provides misleading information affecting their suitability to rent the property.
There is an excellent and very clear summary of the whole of the draft Tenant Fees Bill at the link below.
https://www.lexology.com/library/detail.aspx?g=502415b8-4625-4be8-b010-c0de472866a6
Comments (2)
I’m sorry, but 7 days is unrealistic. Say a tenancy ends on Friday 1st, but they don’t had their keys back/empty the property until the afternoon, and no-one can go out to do the checkout. So the Agent has to go out on Monday, do the report and send it to the Landlord to confirm they are happy. If the Landlord is abroad, doesn’t use email or is at work, it might take 2-3 days before they can respond. So we are already looking at 6-7 days to get a decision, which then has to be agreed with the Tenant.
And if there is work to be done, you have to try and get contractors out, get quotes and get work agreed, all within 7 days? If everything lines up then, yes, it’s possible.
But 7 days to repay a deposit? I tell the Landlord they have 10 days to respond to me after the checkout has been done, and I keep in touch with the Tenants during that time. I also tell the LL that if we haven’t had a response within a certain timeframe then the deposit is automatically returned to the tenant. I don’t want to hold on to the money any longer than I have to, and I know people need it back.
I think 7 working days to get a response is fair enough, but not to get a decision or the money back. Takes a few days for the DPS to send the money anyway!
Countrylass, great passion in your points but you are barking up the wrong tree, the article is about the proposed rules for the holding deposit/reservation fee so nothing to do with the actual tenancy deposit.
The holding deposit is to be offset against the initial rent payment and the tenancy deposit when the tenancy starts, or refunded or not as per the article.