Advice on rental deposit please.

lotty41

Hi all some advice needed please. My partner has given the letting agent the past 3 months bank statements, 3 wage slips, the normal credit checks and reference's have been done. I have also supplied 3 months of bank statements.

They said they wanted our bank statements to check how we 'conduct our daily spending'.!! (I had already paid non-refundable reference fee's of £270 when I discovered this)

I had to give my bank statements as my partner does not have a very good credit rating and I am unemployed but I have a very good bank balance.

They said I may have to pay 2 months rent up front (along with the normal deposit + 1 months rent), I said I was happy to do that.
So yesterday we agreed move in date and I asked them to confirm that we would have paid 3 months rent so rent would not be due until the 4th month. They said no, the 2 months extra would be put in the landlords account and we would get that back when we leave the property!
I emailed letting agent yesterday at 4pm saying that we are not happy about that. In total we would have paid £3270 just to get our foot in the door! Rent on the property is £695.

I am waiting on a reply from them this morning but want to know are they allowed to do this before I risk losing the house.

Thanks
Lotty

princeofpounds

So yesterday we agreed move in date and I asked them to confirm that we would have paid 3 months rent so rent would not be due until the 4th month. They said no, the 2 months extra would be put in the landlords account and we would get that back when we leave the property!

This would be classed as a deposit and needs protecting in a scheme, with a penalty of 1-3x the amount due from the landlord if it is not done properly. The courts have already set precedents that these permanently-in-advance rental payments are deposits.

They may well end up screwing the landlord over this.

Werdnal

As above, the rent is either genuine "rent in advance", ie you pay so many months upfront, and then do not pay any more until the advance sum runs out, or a deposit, ie you pay it now, it requires protection like any other deposit, and is returned to you at the end of the tenancy.

I think the important phrase is the one in bold above. If the agents have said this, then they (and the LL) must treat this as a deposit and secure it as such. However, I believe there are actually rules about the deposit not being able to be more than 2 months value of rent, so the agents have got this wrong as well.

If you are keen to continue with this property, you need to get written confirmation from the agent as to the exact purpose of this "advance rent" and then use this against them or the LL to your advantage. If they confirm it is technically a deposit, they have to protect it, if not, then start paying rent from the 4th month and keep the written confirmation handy to prove your case!

lotty41

Thanks for your replies.

I am just about to email the letting agent, will let you know what they come back with.

dimbo61

You need WRITTERN confirmation from the agent ( Not an email!)
As others have said this could be to your advantage if they do not protect the whole " Deposit " the Landlord can not issue you with an S21 ( eviction notice) and has to return the whole deposit to you before they can evict you PLUS you may be able to sue for Up To 3X the deposit if not registered within 30 days

lotty41

Email sent, waiting for reply or phone call.

Also was wondering where we stand on getting back our £270 reference fee back if we lose the house. Before I paid the fee I did state to the letting agent that my partner had a low credit score and that I was willing to pay x amount of rent up front if needs be and they said that me have to be the case, they didn't mention it would actually be held as a deposit or otherwise.

lotty41

Oh I thought confirmation via email was accepted. Ok I'll see what they come with and then ask for written confirmation.

Werdnal

lotty41 wrote: »

Oh I thought confirmation via email was accepted. Ok I'll see what they come with and then ask for written confirmation.

With emails, there is no actual proof who sent it - I could send you an email claiming to be from "Joe Bloggs Lettings", and no verified signature on it. Emails do have their place, but if this is likely to turn into a legal battle about the rights and wrongs of deposit versus advance rent etc, always better to get it in a proper, headed paper letter from the agent, which will carry much more weight in a court situation - not saying your dispute will get this far, but you never know.

If the agent refuses to provide it in a letter format, then they are hiding something, as if you are paying any amount upfront (be it deposit or advance rent) this forms part of your tenancy agreement and must be verified in writing.

Guest101

Ye thats fine, once all agreed, just get a written confirmation of the criteria.

But - they asked to see how we conduct our daily spending??!! I would literally tell them where they can put the big noses!

What a cheek. I swear some letting agents really do need to be brought back down to the level of us lesser mortals!

lotty41

Ok here goes......just spoke to letting agent, I'm guessing they worked out that they are not allowed to take more than 2 months deposit from us. She said they are willing to compromise so here is what we have to pay.. 1 months rent in advance + 2 months deposit. But 1 months deposit is held in the letting agents account.
She said if we are good tenants then maybe after a year they will return it to us!!
I asked if it is held with the DPS and she said no, I asked if it was protected and she said no!! She rambled on about 'you dont know us and we dont know you, its a trust thing, when we see all is ok we give it back'.
I have asked for all this in writing, which she agreed to.

So do we move in and then ask for our unprotected money back?

lotty41

I totally agree with you Guest101 but had already paid the fee's!:mad: