How do you handle deposits correctly when renting a London flat?
Deposit too expensive? What are the options if you don’t want to provide a deposit?
Read our handy guide for Guests below to understand all you need to know about deposits in a tenancy!
A traditional tenancy deposit is a refundable amount of money given by you as the renter, and held in escrow by us as a security for the property Owner against losses related to your stay. This escrow account is officially registered with a UK government-approved scheme: mydeposits.
This deposit amount will be around 5-6 times the agreed weekly rent. This will be paid into a client monies account and held there by us, until your move out, and returned to you afterwards.
After you move out, we will inform you within 10 working days if there is to be any claim made on your deposit, to cover any damages in the property. Once we have informed you of that intention, over the following weeks, we will confirm with you the exact amount to be claimed.
We will return the unclaimed or uncontested portion of the deposit to you. For example, if your deposit is £1000, and the deduction claim is £150, we will return the uncontested £850 amount to you.
As an alternative to a traditional deposit, renters can choose a Deposit Replacement Scheme. This option is also sometimes referred to as a Zero Deposit or No Deposit scheme.
This involves paying a fee (equal to one week’s rent), which is non-refundable, to the scheme provider. We work with flatfair as the scheme provider.
This allows you, as the renter, more financial flexibility as compared to a traditional deposit option (because you do not have to offer up the much larger sum of 5 x the weekly rent).
However, you do have to meet the scheme’s acceptance and reference check criteria.
Note also that you will still be liable for rent arrears, and for damages you cause in the property.
Before moving in to your new home, you may be asked to pay a monetary deposit that will be held by us during the length of your stay. This deposit will be refunded to you in full, unless there are any rent arrears, bill arrears, or property damage when you move out.
This is also known as as “traditional deposit”, “tenancy deposit”, or “security deposit”. The tenancy deposit amount you have to pay is calculated like this:
In either case, the exact amount of the tenancy deposit will be shown on our website advert listing page for that particular rental property, and will also be set out in your rental contract.
In line with current English law, your tenancy deposit will be held by is in an escrow account. That ring-fenced bank account, and your deposit, will be protected within one of the three UK government-approved schemes, for example mydeposits is one of those schemes that we at RentLondonFlat work with.
We will register with the scheme to protect the deposit, and provide you information about the deposit and where is it being protected within 30 days of your paying the deposit to us.
No Deposit is an example of a deposit replacement scheme, operated by our partner company Flatfair.
No Deposit is an alternative option for you as renters, who may not want to pay the whole deposit up front and/or wants to offer the Owner a larger deposit than is permitted under the traditional tenancy deposit regulations (these are limited to 6 times the weekly rent).
A No Deposit scheme allows for a greater level of security for both you and the Owner, for example, there could be as much as 10 times the weekly rent’s worth of protection. This could be useful for example if you wish to keep a pet in a property, and there is a concern as to whether the limited traditional deposit option will offer enough security against property damage during your stay.
For avoidance of doubt, the No Deposit option does not remove your contractual obligations during your stay, i.e. to pay the rent on time and return the property to us in an acceptable condition.
You can find more information here flatfair.co.uk/tenants
When you vacate the property , we will assess the condition of the property at the start of tenancy with the condition at the end. We will use the check in and check in report/video which we would have taken and shared with you during the tenancy to make any proposed deductions. This normally takes between 10 and 40 days to be completed depending on the nature of any works required and the progress of any negotiations.
The simple answer is to ensure the property is returned in the same condition as provided. If the property has been cleaned and all possessions removed, then it is very unlikely we will propose any deductions. We will only propose any deductions, where we have clear evidence that you have broken the terms of your contract.
You have the right to raise a dispute with the Government approved deposit scheme within 90 days of the end of your tenancy if you disagree with any proposed deductions. We will provide proof on behalf of the landlord for any deductions proposed using the check in and check out report/video along with estimates. You are also allowed to provide any evidence which assists you in the dispute. An impartial assessor working of behalf of the deposit scheme, will make a binding decision on both parties using the submissions provided.
