What's a tenancy protection scheme? Discussion

theartfullodger

MSE Jenny stated...

Since Apr 07 it's been a legal requirement that anyone who moves into rented accommodation (assured shorthold tenancy) costing up to £2,100/month has their deposit paid into a tenancy protection scheme.

I hesitate to comment on such an august poster's remarks but, err.. not quite I believe.....

a) England & Wales only, sadly not bonnie Scotland (yet?).
b) Not up to £2,100/month but between £250 & £25,000 per annum (£25kpa = £2,083:33/month)
c) If there is a deposit (clearly)
d) And any Section 21 notice is invalid unless the requirements of Deposit Protection have already been adhered to (ie the deposit must be in the scheme before the Section 21 Notice is issued). See Housing Act 2004, Section 215.

Cheers!

Lodger

scarlet_macaw

Jill001 wrote: »

My daughter has been trying to get her deposit back from her agent for 7 weeks since the tenancy ended. The deposit is lodged with mydeposits but as there were 6 tenants and the deposit was registered in the lead person's name on the agreement mydeposits will only deal with the lead person and will not raise a dispute unless the lead person authorises them to do so.

The lead person fell out with the other tenants, left before the end of the tenancy, and is no longer in contact with any of them.

So in this instance, my daughter's cannot get her deposit back at all unless she pursues a claim through the small claims court.

Is this the only course of action, or is there anyway my daughter can use this scheme to return her deposit as the legislation that is there to protect tenants is not helping her at all?

I understand that where there is an tenancy with several tenants, the deposits can be registered in each persons individual name and if it had been done in this way there would not be a problem now. Probably the agents do not want to register 6 deposits as it is far easier to register just one.l

A landlord will not want to register the deposits separately for several reasons:

1) cost - mydeposits charges a fee of £25.00 plus VAT for each deposit registered

2) joint and several liability - if the tenants are on a single lease they will have joint and several liability for the payment of the rent, condition of the flat etc. A landlord does not want to get into a dispute between 'freinds' who have fallen out where one has broken the terms of the lease - all are jointly responsible so the deposit can be held back whoevers 'fault' it is. The landlord is not interested in who didn't do their share - if they rent together they pay together (the situation is obviously different if rooms are rented individually to unconnected persons)

3) different termination dates - where sharers rent a flat together often one will leave and be replaced by the remaining tenants. In this case the incoming tenant will normally pay their share of the deposit to the outgoing tenant. The landlord will not want to get involved in returning monies and taking on new deposits and particularly not in doing a full inspection of the condition of the property to see if any monies need to be with-held due to condition etc. midway through a tenancy.

All in all there are costs involved in all these areas. If you want the savings which come with renting as a group of sharers you have to either accept the downsides or be willing to pay the landlords additional costs of giving you separate individual tenancies - many will not do it even then - my rule is anyone who shares common facilities must be on a common tenancy agreement - I do not want to get into disputes between tenants over who did not clean the toilet!!

scarlet_macaw

clutton wrote: »

the one important part of this legislation that is rarely mentioned is that neither landlord nor tenant are legally bound to use the Deposit Scheme Arbitration Service - and if either party refuses, then the other party has to take the matter before a judge in the small claims court.

This puts tenants back in the same position they were in prior to 2004 Act becoming law.

Legally correct, but in practice not quite true, as under most of the schemes the landlord has to agree to submit to arbitration as a condition of belonging to the scheme.

fordie216

H there, can anyone help, is this something we should be checking out in Scotland or does this only apply to England?
Thanks

theartfullodger

Currently does not apply to Scotland: (contrarily Landlord Registration applies in Scotland but not Engerland)

Cheers!

Lodger

tbs624

Jill001 wrote: »

The tenancy agreement was in all 6 names, the 'lead person' left 2 months before the tenancy ended. Under the terms of the agreement they would not have been entitled to the return of their deposit until the end of the agreement.

MyDeposits website states that where there is a joint tenancy the tenants have to nominate a 'lead person'. MyDeposits will only deal with that person.

I think the 'lead person' may have already raised a dispute with MyDeposits and as you suggest I think the whole deposit amount (£1,500) will be returned to them.

If that happens, the only option I see for my daughter and the other 5 tenants to then claim their deposits would be via the Small Claims Court.

Jill - your daughter should ask to speak to a supervisor/team leader at Mydeposits. The names of *all* Ts who are signatories to the AST for the property must appear on the deposit certificate, and it's the LL's responsibility to ensure that this happens.

Under Rule B2.6 Mydeposits staff *are* able to deal with Ts other than the original nominated Lead T. Your daughter should go on to the website and look up the Scheme Rules and then pursue the matter further, rather than get fobbed off by them. She has every right to know exactly what is happening with her deposit money: the Scheme Rules confirm that each Ts individual rights & obligations are not affected by the appointment of a Lead T, and this should also have been confirmed to them all by their LL..

tbs624

scarlet_macaw wrote: »

3) different termination dates - where sharers rent a flat together often one will leave and be replaced by the remaining tenants. In this case the incoming tenant will normally pay their share of the deposit to the outgoing tenant. The landlord will not want to get involved in returning monies and taking on new deposits and particularly not in doing a full inspection of the condition of the property to see if any monies need to be with-held due to condition etc. midway through a tenancy.

This one comes up on here on a regular basis - the Scheme Rules are that the LL has to repay each T and register afresh for each new T. For example, with Mydeposits see Rules B1.8:

" Deposit protections are not transferable.Protections are only granted in repsect of each individual tenant. A new Tenant will require a new protection"

It is entirely down to the LL to collect, register and repay those deposits - that responsibility cannot be passed from T to T in this way and Ts need to refuse to accept the arrangement. Pay your deposit direct to the LL, get a proper receipt from him/her and pursue the deposit registration within the appropriate timeframe.

tbs624

MSE_Jenny wrote: »

A. Since Apr 07 it's been a legal requirement that anyone who moves into rented accommodation (assured shorthold tenancy) costing up to £2,100/month has their deposit paid into a tenancy protection scheme.

A couple of other points, just to add to Artful's clarification: Only one of the three schemes (DPS) requires the LL to physically pay the deposit across to the schemes. The other two schemes are insurance-based and the LL retains the actual funds for the duration of the tenancy.

If the tenancy deposit was received prior to 6 April 2007 ( even for a tenancy starting after that date) then there was no necessity for it to be scheme registered.. If, however, the T has subsequently signed up for a further Fixed Term AST some recent cases have indicated that the deposit should be registered at that point.

cheapskate80

scarlet_macaw wrote: »

Legally correct, but in practice not quite true, as under most of the schemes the landlord has to agree to submit to arbitration as a condition of belonging to the scheme.

Another thing to add, though, is that it doesn't stand the landlord (or tenant) in good stead if they refuse to take part in the free arbitration. It kind of implies guilt, if nothing else!

We had a nightmare with a former landlord trying to retain our whole deposit after a really short tenancy and for an entirely made-up reason. We did the free arbitration through MyDeposits - it took absolutely ages (3 months) and required quite a lot of chasing, but we got every single penny back. Which is a huge improvement on previous non-TDS tenancies where it was commonplace for tenants to agree to give the landlord a couple of hundred quid for non-specific 'wear and tear'.

scarlet_macaw

tbs624 wrote: »

This one comes up on here on a regular basis - the Scheme Rules are that the LL has to repay each T and register afresh for each new T. For example, with Mydeposits see Rules B1.8:

" Deposit protections are not transferable.Protections are only granted in repsect of each individual tenant. A new Tenant will require a new protection"

It is entirely down to the LL to collect, register and repay those deposits - that responsibility cannot be passed from T to T in this way and Ts need to refuse to accept the arrangement. Pay your deposit direct to the LL, get a proper receipt from him/her and pursue the deposit registration within the appropriate timeframe.

A nice theoretical reply - and wrong to boot!

In practice therefore are you suggesting that when one of four jointly and severally liable tenants wishes to leave before the expiry of the fixed term, the other three tenants should pay their share of the rent? - or perhaps that they should terminate the tenancy early, forfeit their deposits and risk being persued for breach of contract for the rent due for the remainder of the term?

Landlords allow this process to assist groups of sharers and allow them some flexibility, not to make life difficult - It is timre that those who advise tenants took the same approach.

Mydeposits sceme rules (rule B2) make provision for this process.