Tenancy deposits
There are two main reasons why landlords take
deposits:
- Holding deposit: to hold the tenancy for a short period
prior to the contract being signed.
- Security deposit (sometimes referred to as a damage deposit,
rental deposit or bond): to give the landlord a reserve fund in
case of problems.
The holding deposit
The holding deposit is particularly
appropriate where there is good demand for the property and the
landlord may lose other prospective tenants if you cause
unnecessary delay or decline the tenancy at the last minute.
In the event of the tenancy agreement falling
through, the landlord may well decide to keep this holding deposit
to offset for the inconvenience and cost caused, but this should be
pointed out and stated in writing to you at the outset.
However, if the tenancy agreement falls
through because of the landlord’s decision, you cannot be
charged.
The security or damage deposit
The items that are usually covered by the
deposit are listed below, all of which should be referred to in the
letting agreement.
- damage to the property, landlord’s fixtures, fittings and
furniture - beyond normal wear and tear
- cleaning - for example, a cooker or carpet cleaning.
- rubbish removal - tenants may leave unwanted items of their own
such as furniture or general rubbish both inside and outside the
property.
- unpaid rent.
- replacement keys/locks when keys are lost or not
returned: if keys are not returned, it is a landlord's duty to
change the locks.
Further information
For further information about tenancy deposits
visit Direct.gov.