Advantages Of The New System

Now if all this seems complicated – that’s because it is a bit. But it’s a whole lot better protection than tenants have ever had before and that can only be good news all round. We’ll all soon get used to these changes and won’t be able to believe we ever relied on the existing roughshod system.

These systems will also involve tenants in a new way. Adult negotiation between parties is to be encouraged to avoid disputes. So too is the new realisation for tenants that they can’t leave a totally decimated dump in their wake then threaten the landlord with court if he doesn’t pay up on the spot, then clean up for free.

Option 2 The Custodial Scheme

This is a single national scheme: the Deposit Protection Service. Contact www.depositprotection.com . Again despite the service style name, this is another purely commercial organisation, part of Computershare Investor Services Plc. Unfortunately, this service is not being paid for by fees from landlords/agents, but – believe it or not – from the interest generated by tenants’ deposits. So I guess that any interest returns to tenants will take a nosedive. Ho hum.

Under this system, landlords/agents will simply put the entire deposit into the single national custodial scheme immediately (or as before within 14 days of receipt). And again, tenants have a legal right to specific documentation telling them exactly where their precious deposit is being safeguarded. End of tenancy situations will be very similar to the ones explained earlier – except where landlords/agents use this scheme, do not expect instant refunds as a whole system needs to be gone through before tenants’ money is refunded.

Again, I expect the ten-day norm to bed down and that’s a long time for many tenants. The process with disputed deposits will be similar and offer a dispute resolution service as an option instead of court. And again, both parties must at least be able to agree to use arbitration.

To help you understand this system, try contacting your Citizens’ Advice Bureau, the local authority’s private lettings officer or www.tds.gb.com who have very helpful telephone staff, on 0845 226 7837.

Obvious Pitfalls

I’m not alone in making sure that good tenants who’ve cleared up get a full deposit refund a jolly sight quicker than ten days. Many tenants need their old deposit to fund their new one – that’s why they did such a good clear up. Now, there’s nothing in the insurance based system to prevent this from happening with landlords who held onto deposits, but I am concerned that prompt deposit refunds will become even rarer and ten days become the norm.

My second concern is more serious. I’ve come across some pretty unsavoury characters who love lettings because it generates a low profile, high control, cash only business. Tenants may find themselves pushed by some landlords into accepting a higher deposit deduction than is fair by the threat of tying funds up for some time in a system. When tenants are as cash strapped as they often are, this type of threat – especially where large deposit deductions are being demanded – may well intimidate tenants into accepting a lower refund on the spot. We shall see. But I wish I’d seen a way round this discussed on any of the official websites, who still seem in complete denial about the some of the characters who’ve been attracted to being landlords over the decades.

My third concern is how I wish that our legislators lived in the real world, where everyone wasn’t some ‘nice, reasonable guy’ (above) who’d happily comply with a new law – indeed with any lettings law. The very tenants who suffer lousy landlords (usually those at the bottom of the cash pile) are the worst placed people of all to tackle a strapping landlord who fails to safeguard their deposit – especially on six months’ security of tenure! How in the world a tenant enforces this with some landlords is beyond my powers of imagination. Theoretically, you can challenge them.

Reasonable Behaviour For Both Parties

Reading this lesson has already shown what will always be reasonable conduct on both sides of these contracts.

• Look for a unit that someone cares for, then respect that in how you live there.
• Make sure that you know enough about the new 2007 mandatory scheme to protect your deposit.
• Don’t do home improvement!
• Cleaning up after you isn’t a miraculous quid pro quo. You’ll get a hefty bill – calling in a team of cleaners to get a place shipshape for reletting costs real money.

 

It costs four hours labour minimum to clean out a disgusting cooker. Hours to redecorate and get carpets professionally cleaned if you spilled coffee all over them or never took off your shoes when they were dirty.

Very often, tenants see the true costs of cleaning up, redecorating or replacing a bed as theft, when the reality is that household work, repairs and decorating cost huge sums of money – the kind of money that tenants simply hadn’t appreciated. However, in truth, this isn’t actually a finance issue. Some of my most glowing references have been written for people who had relatively modest weekly budgets, but cared about their environment, respected other people’s property and never had any difficulty in working out that clean meant really, really clean.

One Final Tip

If you live as promised and get a full deposit refund, ask your old landlord/agent for a personal reference. The only piece of paper that I and most independent landlords take seriously is a glowing reference from someone else who’s rented out to you before – they’re worth more than gold!