Rent - Admin fee for re-registering deposit?

john10001

Why do I need to pay an admin fee of £35 to re-register a deposit each year for privately rented accommodation?

And, WHY don't they send you a cheque every 6 months for the interest earned on YOUR MONEY?

I know that in the US, landlords holding deposits return interest to the tenants!

In the UK these government backed/operated deposit "schemes" seem to be money making "scams" that don't really give any extra protection to the tenant as the tenant is losing money automatically by being forced to be in one due to the changes in legislation.

I'm not so sure that either landlords or tenants are happy with this, I know I'm not.

vuvuzela

My suspicion is that the agents are taking you for a ride with their ridiculous fee.

MamaMoo_2

Depending on which scheme they use, the landlord does have to pay for the length of each tenancy agreement. So if you have 4 x 12 month agreements, they will have to pay four times.

See here (page 4) http://www.tds.gb.com/resources/files/The-Tenancy-Deposit-Scheme-for-Landlords.pdf

Here http://www.mydeposits.co.uk/landlords/pricing/protection-fee

However, the Deposit Protection Scheme does not appear to charge. So it depends entirely where your deposit is held.

Although neither of the two that do charge charge £35, so it's possible the £35 you pay includes a small admin charge for the cost of doing it.

Also, the protection schemes do not have to pay interest to landlords, and therefore the landlord earns nothing on your deposit, it's simply protected. Unfortunately (or fortunately, if you prefer) this isn't the US, and therefore we have different legislation and different ways of running these schemes

arcon5

The DPSs cover their overheads from the interest gained - so not a scam at all!

You're just with a cr*p agency. The deposit doesn't need renewing with them each year. Does you contract have anything about this in? If not then you could dispute the charge - after all if you don't pay they still have to legally protect it. Although it could cause other problems and of course doesn't affect the LLs rights.

chickywiggle

We've been in the same house for 4 years on a rolling tennancy........ never been asked to pay an admin fee every year.... my suspecian is you are being had.

MamaMoo_2

arcon5 wrote: »

The DPSs cover their overheads from the interest gained - so not a scam at all!

You're just with a cr*p agency. The deposit doesn't need renewing with them each year. Does you contract have anything about this in? If not then you could dispute the charge - after all if you don't pay they still have to legally protect it. Although it could cause other problems and of course doesn't affect the LLs rights.

chickywiggle wrote: »

We've been in the same house for 4 years on a rolling tennancy........ never been asked to pay an admin fee every year.... my suspecian is you are being had.

There are three deposit protection schemes. Two out of three of these charge (see my links above). Depending on which one a landlord uses, fees are payable at the start of a new tenancy. Although why they don't all use the free one is beyond me...

agrinnall

While I agree that there shouldn't be a charge for protecting deposits (at all, not just to re-register, the LL should regard that as a business operating expense, claimable against tax) I don't see how you work out that the tenant is losing money because their deposit is protected in a scheme. They'd have to hand over the deposit to the LL whether there was a protection scheme or not, so that money is out of their control for the duration of the tenancy in any case.

MamaMoo_2

agrinnall wrote: »

While I agree that there shouldn't be a charge for protecting deposits (at all, not just to re-register, the LL should regard that as a business operating expense, claimable against tax) I don't see how you work out that the tenant is losing money because their deposit is protected in a scheme. They'd have to hand over the deposit to the LL whether there was a protection scheme or not, so that money is out of their control for the duration of the tenancy in any case.

You could argue that about many expenses, such as credit checks etc, however all the local estate agents to me are still intent on charging £100-150 per person background checking, plus £100-200 admin and handover fees, and that's before deposit and rent in advance...
No wonder the council lists are so long!