Tenancy Deposit Protection
New legislation affecting tenancy deposits came into force on the 6th April 2007; this legislation has a major impact in the private rented sector. Tenancy Deposit Protection (TDP) is new legislation introduced under the Housing Act 2004 to ensure that when a tenant pays a deposit, and is entitled to get it back, they can be assured this will happen.
All deposits taken for a new Assured Shorthold Tenancies from this date must be protected in a Government-authorised tenancy deposit scheme (this also includes an existing tenancy that is renewed and a landlord agrees a new fixed-term tenancy/extension, the initial deposit taken must then be lodged with a tenancy deposit protection scheme). All landlords must comply with these regulations. Failure to observe the rules & regulations regarding Assured Shorthold Tenancies after the 6th April 2007 are harsh:
- The Court will order repayment of the deposit to the tenant and the landlord will have nothing
- The Court will further order the Landlord to pay 3 times the deposit amount to the tenant as compensation for not holding it correctly in the first place
- The Court could order further costs
- Whilst non-compliant, the landlord will forfeit the right to serve a Section 21 Notice to repossess the property and will only be able to regain possession if the tenant surrenders the property or if the tenant significantly breaches the tenancy agreement.
The offices of Norton Properties are members of The Deposit Protection Service (DPS), which is administered by Computershare Investor Services. Which is the Government Approved Custodial Scheme.
Click here to download a comprehensive guide to this legislation and the ( link to schemes)
Our property management package includes services such as rent collection, handling administration and legal notices, as well as assistance with more complex issues and the provision of a 24-hour emergency line for tenants.
Different Types of Tenancy Deposit Schemes
There are two types of tenancy deposit protection scheme available for landlords and letting agents (insurance-based schemes and custodial scheme). All schemes provide a free dispute resolution service. This system works entirely on the basis of papers submitted to the adjudicator. Landlords and tenants must have a clear understanding on the condition of the property through best practice. Therefore, we advise landlords that it is necessary to have a comprehensive/professional inventory and schedule of condition and proper invoices and estimates to support any claim. Claims that do not have these are unlikely to be entertained
Insurance Based Scheme
The Dispute Service Limited (The Tenancy Deposit Scheme*)
*Norton properties is a member of this scheme which is backed by ARLA, RICS and the NAEA.
thedesputeservice.co.uk
Insurance Based Scheme
MyDeposits.co.uk (Tenancy Deposit Solutions Ltd) is jointly owned by the National Landlords Association & Hamilton Fraser Insurance.
mydeposits.co.uk
Custodial Scheme
The Deposit Protection Service (The DPS) run by Computershare Investor Services will be free to use for both tenants and landlords. Landlords cannot hold the deposit under this Scheme.
depositprotection.com
Landlords who choose our services via the Insurance backed schemes will be charged a deposit administration fee of £50.00 + VAT for protection of the deposit and a subsequent charge for all contract renewals, we will also provide the required prescribed information to the tenant. Norton Properties protects the interests of the client landlord by ensuring prescribed information is provided correctly and promptly.
To find out more about the Tenancy Deposit Schemes Click here