When you agree to take on a tenancy agreement for a property you will have to pay the landlord money as security that you will not damage the property (a deposit). There are two types of deposit you may be asked to pay directly to the landlord or accommodation agency dealing with your accommodation.
- Must be paid before you move in.
- Protects the landlord from damage to the property, unpaid rents and removal of furniture.
- When you pay the deposit you should receive a copy of the inventory;a complete list of items in the house.
- Check the inventory carefully. When the tenancy ends you may be held responsible for missing items. If this is the case, the items will be replaced with the money from your deposit.
- You may not be refunded any of your deposit.
- The deposit should be refunded to you when the tenancy ends minus any amount you owe for damage to the property, rent or unpaid bills.
- Money you pay when you agree to rent a property but are not moving into it immediately. It is paid to the landlord as security and allows him/her to take the property off the rental market.
- If you do not move into the property the holding deposit is not refunded.
- The holding deposit is usually deducted from the security deposit when you move in. For example, if the holding deposit is £100 and the security deposit is £500, you would initially pay the landlord £100 then a further £400 on the day you move in.
If you feel you have been treated unfairly you can contact your local Citizens Advice Bureau for more advice.
Tenancy deposit protection
In England and Wales, if you pay a deposit to a private landlord or accommodation agency your landlord must place it in a tenancy deposit protection scheme. This means you can be sure that you will get your deposit back at the end of the tenancy, as long as you are entitled to it. The tenancy deposit protection scheme also provides a service to sort out any disagreements about the deposit between you and your landlord, without going to court.
In England and Wales, a landlord can charge you ‘key money’ for granting a tenancy and there is no limit on what the landlord can charge. If the charge seems too high the tenant has no choice other than to not take the accommodation. Please note that this is illegal in Scotland.