Protecting deposits for lodgers (more than one) how to do it?

FlickyK

Hello,

We’re renting out two of our spare rooms to lodgers - we’ve found two really nice people although we’re not totally naive and have asked for deposits from both.

And both have asked if we will protect their deposits which seems more than fair to us! A quick search seemed to suggest that whilst you don’t have to, you can use the deposit protection schemes to protect your lodger’s deposits... great!

BUT the two we tried so far only seem to want to bundle them up in to a single tenancy?? Tenancy deposit scheme seems particularly frustrating as it insists on a lead tenant but obviously they are separate people who will pay separate deposits that won’t be tied together. There is a link to ‘multiple tenants’ but it doesn’t seem to take me anywhere.

Similar with Deposit Protection Service, just seems to want to make it two tenants sharing a tenancy?

I will call them tomorrow to find out more what/how to do it but thought I’d just ask on here to see if anyone else has had managed to figure it out before??

Thanks in advance!

anselld

Don't know about TDS but with DPS you can certainly create more than one tenancy per property. Just create two completely independent tenancies rather than one tenancy with two tenants.

I am not convinced it is a good idea though. Volunteering for additional admin which is not a legal requirement could be the thin end of the wedge. Are you going to issue PIs, for example. What about the "How To Rent" document? Where exactly will you draw the line?

zagubov

I'd be careful.

You don't want to create a landlord-tenant relationship when a landlord-lodger one would be far simpler and less onerous.

Life's complicated enough as it is without seeking out more complications!

FlickyK

Super! Actually once you pointed that out I thought I could have just done it with a different scheme for each one if I’d got really stuck but easier to have both with the same!

I found a template (from the DPS) for PI and filling out and printing out a few pages and adding a couple of clauses to the basic lodger agreement around when the deposit could be retained doesn’t feel like too much work I guess...

I think we just feel incredibly lucky that we bought a house and are lucky enough to have people helping us to pay the mortgage so definitely don’t feel like we got the thin end of the wedge 😊

G_M

It's to your credit that you want to voluntarily protect the deposits, but I'm not convinced I would. Actually, I'm sure I would not!

The schemes were introduced to protect tenants from dodgy landlords. You are clearly not a dodgy LL. OK - the lodgers don't know that, but they'll find out just by living with you. I see downsides and minimal upsides to increasing your admin at both the start and end of contracts.

More important is ensuring your contract is sound, is periodic not fixed term, has sensible notice periods (1 week each way?) and either includes, or is supplemented by, clear house rules which both sides understand and agree to from the outset.

* Lodgers: advice & links for landlords & lodgers

FlickyK

Fair enough!

Just so I make sure I understand, what do you see as the major downsides?

Thanks!

FlickyK

We set the notice as 1 month but tenancy is indeed periodic rather than fixed... I can’t see how protecting the deposit would cause us any major issues?

I’m hopeful we’ve picked decent lodgers but you’re right - only time will tell!

[Deleted User]

FlickyK wrote: »

We set the notice as 1 month but tenancy is indeed periodic rather than fixed... I can’t see how protecting the deposit would cause us any major issues?

I’m hopeful we’ve picked decent lodgers but you’re right - only time will tell!

It's not a tenancy or at least I hope you haven't granted tenancies to what should be excluded occupiers.

One months notice is a long time to be stuck living under the same roof as someone you can't stand if things go sour.

FlickyK

Yeah you’re right not tenancy but we said one month notice...

I guess we’ll see how it all goes!

zagubov

Never in a million years should you let the word tenancy be uttered in the context of your lodgers arrangement.

And don't be lulled into a sense of security by how nice they are.

You need to have clear house rules, and they don't have to be extreme.

G_M

FlickyK wrote: »

We set the notice as 1 month but .....!

Have these contracts been signed? If not yet, reconsider.

One months notice is a long time to be stuck living under the same roof as someone you can't stand if things go sour.

We've had threads here from LLs whose 'lovely' lodgers became a nightmare to live with, and on being given notice became even worse for the final month....