rental deposit

victorias_dad · 7 December 2017 at 9:12PM

My daughter is looking at a flat share taking over from someone already a tenant who is moving out, the deal is my daughter pays the out going tenant £700 being the deposit the outgoing tenant paid to the landlord. I have seen this sort of deal on Roomshare but it does seem a bit off to me any thoughts?.

hometrader · 7 December 2017 at 9:42PM

I’ve never really dealt with lettings, seems a little bit fishy to me though. As far as I know deposits are normally kept with the DPS, so unless your daughter is getting some sort of official letter to say the deposit has been changed into her name I’d be careful. It’s possibly a way of them avoiding paperwork, I’m not sure. But if she has no real proof of paying it and the deposit is still in previous tenant’s name.... ? Doesn’t sound ideal.

G_M · 7 December 2017 at 9:44PM

No.

If she pays the 'deposit' to the outgoing tenant then the landlord has never received a deposit from her and need not return one to her.

She would have to reclaim it from the long-gone ex-tenant.

The landlord is being lazy.

* The last tenant's tenancy should be ended.
* inventory checked
* deposit returned from the deposit registration scheme
* new tenancy created in your daughter's name
* new deposit taken by LL from your daughter and registered in a scheme.

The exception would be if your daughter is becoming a lodger ie one or more of the the other existing tenants are subletting her a room. In that case, the other occupant(s) are her landlord and she is a lodger (sharing with her landlord). She then pays the deposit to her (resident) landlord who pays the outgoing occupant (who might be a lodger or tenant - does not matter to your daughter).

JennyP · 8 December 2017 at 10:51AM

I am a landlord and let rooms in a shared flat. Each tenant pays me a deposit which goes in the DPS. Then when someone leaves, I refund that deposit via the DPS and the new tenant pays their deposit to me directly.
I really wouldn't pay the outgoing tenant if I were in your daughter's shoes.

00ec25 · 8 December 2017 at 11:06AM

it is not that unusual to have such an arrangement of the incoming paying to the outgoing, particularly in respect of student house shares

BUT

that does not make it right in the modern world as it is a hangover from the pre deposit protection days and means the situation is open to abuse. The actual deposit protected by the LL will doubtless be in the name of a "lead tenant" as that is how the deposit schemes work for sharing situations. The lead tenant is then the person to whom it would be refunded by the LL when the tenancy ends thus discharging the LL's legal liability. However, the lead tenant may or may not be reliable enough to then pass over any share due to the other house sharing tenants. Good few threads on here where that has not happened and the other tenants have to sue the lead, who in the meantime has disappeared with no forwarding details.

Whether your daughter can "force" the landlord to change is a different matter.

JennyP · 8 December 2017 at 11:10AM

00ec25 wrote: »

it is not that unusual to have such an arrangement of the incoming paying to the outgoing, particularly in respect of student house shares

BUT

that does not make it right in the modern world as it is a hangover from the pre deposit protection days and means the situation is open to abuse. The actual deposit protected by the LL will doubtless be in the name of a "lead tenant" as that is how the deposit schemes work for sharing situations. The lead tenant is then the person to whom it would be refunded by the LL when the tenancy ends thus discharging the LL's legal liability. However, the lead tenant may or may not be reliable enough to then pass over any share due to the other house sharing tenants. Good few threads on here where that has not happened and the other tenants have to sue the lead, who in the meantime has disappeared with no forwarding details.

Whether your daughter can "force" the landlord to change is a different matter.

My deposits are protected individually - 3 bedrooms = 3 separate deposits with DPS. Each tenant is effectively a lead tenant.

It has worked OK so far. I have been very lucky and all but one tenant have been great.

pramsay13 · 8 December 2017 at 11:21AM

It depends on the exact situation.
I let out a flat to three people and only one is named in the deposit protection scheme as the lead tenant so that tenant will have to distribute the deposit on return.
In the past, I've had the lead tenant leaving during the term of the lease, so I ended it and refunded the deposit and got a new one from the new lead tenant.
Another time someone else was leaving so the new tenant just paid their share of the deposit to the person leaving as the person leaving wasn't named in the deposit protection scheme anyway.

G_M · 8 December 2017 at 12:57PM

It might help to clarify if this is

1) a joint tenancy (several occupants all on the same tenancy agreement)
or
2) a sole tenancy (each occupant of the property has their own individual tenancy agreement

I suspect it is 1) above.

victorias_dad · 8 December 2017 at 2:24PM

Thanks for all the replies I will try and find out the exact terns and get back later

saajan_12 · 8 December 2017 at 2:28PM

Actually a few options: OP, please confirm which applies and follow the relevant advice, as it can make a difference.

1) Joint tenancy: daughter will be a joint tenant renting the whole property from the main landlord
--> Either LL should return deposit to outgoing tenant(s) and new group of tenants (daughter + remaining housemates) pay a new deposit, which LL registers with a protection scheme
--> Or LL and all current tenants sign a deed of variation to replace outgoing tenant with daughter. This must be witnessed and executed as a deed. Daughter can then transfer deposit to outgoing tenant and at the end of the tenancy LL should return it to the new group of tenants including daughter. Note daughter will be jointly liable with housemates for old & new damages.

2) Individual tenancy for room only with access to living areas.
--> a) Either LL returns deposit to outgoing tenant and daughter pays a new deposit to LL who registers it with a protection scheme.
--> b) OR LL and outgoing tenant sign a deed of variation & get it witnessed to replace outgoing tenant with daughter. Daughter can then transfer deposit to outgoing tenant and she should receive it from LL at the end. Note daughter will be liable for old & new damages.

3) Lodger (colloquially called 'subletting') of current tenants
--> Daughter's landlord(s) are the other tenants, she can pay the deposit to them / outgoing tenant and they are responsible for repaying her at the end. Nothing to do with the top LL.

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rental deposit

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