Holding fee and reference check

Zyx

I just read that if the reference check fails the agency will keep the holding fee which is £600.

Is this normal or do you guys think it is a scam? I just think it is extremely easy for the agency to show the flat to an unlimited amount of people and constantly keep the holding fee for a failed reference check.

It is the first time for me and after reading about agency managers punching tenants and agencies keeping deposit money I just wish I could meet landlords myself.

Algar

No it's not normal. If you have told the complete truth in your application then the only charge should/may be the costs associated with it, if you fail the tests and are rejected then the remainder should be returned to you.

Generally a full credit check would cost under 50 quid.

If they refuse to refund you (if you fail the check) start with a LBA and then sue the agent and possibly the landlord as well.

Be aware, some expenses will be legitimate.

Zyx

As far as he told me the holding fee will be deducted from the final payment upon moving in.
However it says at the bottom of the offer confirmation that if the reference check is failed the full holding fee is kept for expenses but I don't think £600 for barely doing anything is realistic.

They have not enquired about references yet but when he talked to me he just told me they would confirm my work place. Is giving them the number for HR fine?

ruggedtoast

Its unfair and contemptible but unless the government abolishes this complete scam in England, as has been done in Scotland, its quite legal.

£600 is a hell of a lot though. The most I have heard of.

gaz141

I think your own initial post confirms what you and certainly me are thinking and this reminds me of one of the "Rogue Trader" segments on the BBC Watchdog show of agencies offering multiple potential tenants the same property whilst charging them the same non-refundable fees and then rejecting them for failed credit reference checks with zero proof and pocketing their cash. The show exposed some guy who was notorious for this and lived in a mansion. I wouldn't touch this with a barge pole

PasturesNew

At the time you view/apply, you're often desperate to avoid having nowhere -and they're never really clear about what's what at all. It's a rush of adrenaline on your part, they're waffling, you're handing over wads of cash and it can be tricky to understand what their idea of a holding deposit is for and all about - and how all the many fees etc actually work.

I just handed money over, glad to have somewhere ..... I didn't really know what it was all about to be honest.

Shelter have some gubbins about it http://england.shelter.org.uk/get_advice/private_renting/costs_of_renting/letting_agent_fees_and_charges

nzseries1

I don't understand how it can be legal - Zyx you have thought exactly what I have always thought.

Who is to say the agent doesn't let 6 people apply, each paying £600, with the agent knowing full well that 5 of those 6 were never going to get the place. And boom! Instant £3000 profit for doing nothing.

They don't of course tell the 5 people that they were never going to be successful, they just fob them off with "Sorry, you didn't pass our reference check. Goodbye."

You might claim that "they wouldn't do this" - but how do you know? And you'd never be able to prove it either.

princeofpounds

Sorry to say it, but I just wouldn't deal with this letting agent full stop. This sort of behaviour is exploitative, little better than 'Nigerian' email scams.

ripplyuk

I've been looking for a house to rent recently and the fees are horrendous. They want £50 just to 'register an interest', which isn't refundable, then there's an admin fee, an application fee, credit referencing fee, deposit protection fee, tenancy agreement fee, inventory fee and a pet disclaimer fee. That's just to get into the house. Total around £480.

At the end of the tenancy there's a property inspection fee, another inventory fee and either a check out fee or another tenancy agreement fee. They also charge for any correspondence between myself and landlord ie: letters about repairs etc.

Between all the fees, the deposit and months rent in advance, there's no way I could afford it.

Guest101

Zyx wrote: »

I just read that if the reference check fails the agency will keep the holding fee which is £600.

Is this normal or do you guys think it is a scam? I just think it is extremely easy for the agency to show the flat to an unlimited amount of people and constantly keep the holding fee for a failed reference check.

It is the first time for me and after reading about agency managers punching tenants and agencies keeping deposit money I just wish I could meet landlords myself.

- his job has little to do with his violent nature i suspect.

On topic: what are their criteria for passing / failing their credit / affordability check?

- Good practice is for tenant to fill in application. LL reads and either accepts or declines. Then credit check. - as long as nothing else comes up, they pass. If they failed to disclose, the LL has the option to pass or fail.
- Sensible and fair.

emma12345

Can I just remind you of Shelter's petition to end excessive letting agents fees? I've no connection with Shelter but was intending to rent and was shocked at the agent's fees, most of which are non-refundable.

http://england.shelter.org.uk/campaigns/fixing_private_renting/letting_agencies/sign_our_petition

Please spread the petition around, we need to get as much protection from this ripoff as our Scottish friends do. Thanks.