In light of a recent story concerning a Harwich based estate agent allegedly stealing more than 42,000 of rental deposits, this once again places a spotlight on what should happen to tenancy deposits.
From a landlord’s perspective, deposits must be protected within 30 days of receipt. A failure to do so leaves the landlord open to a claim from the tenant of up to three times the amount of each unprotected deposit. If you are letting properties to various tenants, you need to ensure that each tenant’s deposit is individually protected in an approved scheme.
Within the same timescale you must also provide the tenant with a document called “prescribed information” which confirms the details of where the deposit has been secured, and other useful information. Solicitors often receive enquiries from landlords regarding their right to deduct money from the deposit, to compensate for damage to the property during the tenancy caused by the tenant, or for overdue rent that hasn’t been paid. There are a number of circumstances that will dictate on what grounds money can be deducted from the deposit, including the terms of the tenancy and the grounds for which money is to be deducted. It is important to seek advice from a professional to ensure that you aren’t in breach of the rules before doing so.
As a landlord, if you have any concerns about your obligations regarding deposits, our solicitors are well placed to advise you on your obligations, and on any potential liabilities that may arise. For more information, please call 01206 764477 to speak to Joe Brightman or Harriet Brice.