Recent figures published by the Centre for Economics and Business Research (CEBR) have shown that almost 300,000 landlords in England & Wales don't have their tenants deposit in a government approved scheme.
For any assured shorthold tenancy (AST) that started after 6th April 2007 the deposit must be held in a tenancy deposit protection scheme approved by the government. Failure to do so could lead to a fine of thousands of pounds if found out.
There are 3 schemes approved by the government; MyDeposits, Tenancy Deposit Scheme (TDS) and the Deposit Protection Scheme (DPS).
These schemes secure the deposit independently from a Landlord or Letting Agent. To release the deposit at the end of the tenancy the Landlord, or Agent on behalf of the Landlord, can claim any deductions (if any) that they feel are necessary, these deductions must then either be be approved or declined by the tenant before any money is released. If there are any disputes over these deductions the whole deposit is kept in the scheme until the disputes have been resolved.
Hannah Maundrell, Editor in Chief of money.co.uk says how "While many landlords are doing the right thing and protecting deposits in one of the official government backed schemes, a worrying amount of money is falling through the cracks and far too many tenants are being left vulnerable. It's not right that tenants are left responsible for taking their landlord to court if their deposit hasn't been protected".
At Belvoir Bury we use the Deposit Protection Scheme (DPS). Whereby we must submit the deposit into the scheme within 30 days of receiving it. This ensures all our deposits are safely stored and the process of resolving any disputes and returning the deposit is straightforward. This gives peace of mind to both our tenants and landlords.
References:
https://www.gov.uk/tenancy-deposit-protection/overview
https://www.depositprotection.com/
