& S T I S O P DE payments other housingresentation Centre Student Advice
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d e e n u o y t Wha to know... Before you move into a new house or flat you may be required by the landlord to pay various sums of money. There are a number of different payments in addition to rent which you may be required to pay at the start of a tenancy, or as a condition of being granted a tenancy.
This leaflet is intended to give information about these payments e.g. what they are for, whether they are returnable and, if so, how to ensure that you get them back. If you need further information or have any problems with these payments, please contact the Student Advice & Representation Centre.
Premiums A premium (also called “key money”) is a non-returnable lump sum paid to a landlord to secure a property. Not very many landlords ask for a premium, but it is not illegal to do so and there are no restrictions on the amount a landlord can request. If your landlord requires a premium think very carefully whether you should pay it given that they are not often required.
Agency Fees If you find accommodation through an estate agent or accommodation agency, it is likely that you will be charged for this service. You may also be required to pay other charges e.g. for drawing up a tenancy agreement or inventory. Fees vary between agents. The important point is that you can only be charged if and when an agent is successful in finding you somewhere to live. It is a criminal offence for an agent to ask for or accept money simply to register your name and/or requirements. It is also a criminal offence for an agent to ask for or accept money for supplying addresses or other details of houses to let. If an agent asks for money prior to finding accommodation you should consider carefully whether or not to pay as it may be difficult to get your money back e.g. what would happen if you failed a reference check?
Retainers A retainer is a payment made to a landlord by a prospective tenant who wishes to move into the accommodation at a later date. There are no restrictions on the amount the landlord can ask from the prospective tenant, but students commonly pay half-rent for July and August. In the period covered by the retainer leading up to the start date of your tenancy the landlord has complete access to the property, including the right to rent it out (at full rent) to others.
Half Rent Alternatively, some landlords will charge half rent during the period after the contract has started but you have yet to move in, again this is usually during July and August. During this period of ‘half rent’ you have a legal right to access the property, and the landlord should not attempt to restrict your access. You may also be responsible for bills during this period.
Rent In Advance Some private landlords ask for rent to be paid in advance before the tenant can move in. How much rent in advance (if any) they ask a prospective occupier to pay will vary, and landlords are free to ask for any amount, although we would recommend that you do not pay more than one rental period (e.g. one month).
Post-Dated Cheques Many landlords ask students to hand over post-dated cheques before a tenancy has started, usually for the rent for the whole tenancy period. Whilst this is not illegal and is common practice, there are issues that you should consider:
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The cheque could be presented and cashed before the date on the cheque. You may not have enough funds to cover the amount of the cheque. The bank may make charges for being overdrawn, returning or holding the cheque.
As an alternative you could discuss paying your rent by standing order and in that way your landlord is assured that they will receive the rent on a certain date.
Deposits A deposit is a sum of money which you may be required to pay to a landlord (or their agent) as security in case you damage the landlord’s property or furnishings. The contract may specify that it can also be used to cover, for example, unpaid bills, unpaid rent and missing items. The deposit paid when you sign an agreement is usually paid as a holding deposit (which turns into a damage deposit when you move in). If you decide not to move in, you need to check with the landlord/agent to see if you would lose the deposit.
The amount of deposit that tenants are required to pay varies. Commonly, landlords ask for a sum equivalent to a month’s rent, but they can legally ask for up to one-sixth of the annual rent (usually 2 month’s rent). For all Assured Shorthold Tenancies, if you pay a deposit your landlord must protect it using one of three Tenancy Deposit Schemes. The aim of the schemes is to protect private tenants’ deposits from being wrongfully withheld by landlords or agents, and help resolve disputes about the return of deposits where they arise. Landlords will be able to choose between two types of scheme: • •
One custodial scheme where the deposit is held by the scheme during the tenancy and during any legal dispute. The Deposit Protection Service is running the only custodial scheme. Two insurance-based schemes where the landlord or agent keeps the deposit, but the deposit is insured in case of any dispute. The two companies running these schemes are mydeposits and The Tenancy Deposit Scheme.
Landlords or agents should only take a deposit from a tenant if that deposit will be protected in one of these schemes. If your landlord hasn’t protected your deposit, you can submit a claim to your local county court and they can order the landlord or agent to either repay the deposit to you or protect it. Your landlord can also be ordered to repay three times the amount of deposit to you as a penalty for failing to protect your deposit in the first instance. If you are asked to pay a deposit you should make sure you have something in writing specifying how much the deposit is, what it is meant to cover, that it is refundable (subject to certain deductions the landlord may legitimately claim for) and which scheme is protecting your deposit. You should obtain a receipt for any deposit paid and keep this safe.
Getting your deposit back Within 14 days of receipt of the deposit, your landlord or agent must give you the following details: • • • • •
The contact details of the Tenancy Deposit Scheme they are using. The landlord/agent’s contact details. How to apply for the release of the deposit. Information explaining the purpose of the deposit. What to do if there is a dispute about the deposit.
Safeguarding your deposit •
When you move into a property, you should draw up an inventory, or check the existing inventory if there is one. You should make a detailed list of the furniture and fittings in the property and you should record the condition of the items in the inventory and the general condition of the property. It would also be helpful to take photographs and make a note of any problems on the inventory. See the Student Advice & Representation Centre’s “Housing Inventories” sheet for more detailed information on inventories.
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Take care of the house and furnishings during the tenancy. Ask the landlord to remove any furniture you do not need. Make sure you observe your obligations in your tenancy agreement. Towards the end of your tenancy write to the landlord inviting him/her to inspect the property. Ensure the property is clean for the inspection. Use the inventory. Make sure you settle all bills keeping confirmation of payment. When you leave, return all keys to the landlord and make a written request for the return of your deposit. Keep a copy of the letter.
When your tenancy comes to an end the landlord should return your deposit to you in full if you have kept the property in good condition. The deposit must be returned within 10 days of the landlord and tenant agreeing how much of the deposit should be returned, or within 10 days following notification of an ADR/court decision (see later). If you have caused damage to the landlord’s property or furnishings, it is reasonable for a landlord to make a deduction from the deposit to cover his/her losses. It is not reasonable for a landlord to make deductions for fair wear and tear. For international students returning home when their tenancy ends, tenancy deposit schemes will be able to return deposits into foreign bank accounts (although there will probably be a charge for this that the tenant will need to pay).
What if the Landlord witholds part, or all of your deposit? If there is a dispute over the return of the deposit, each of the three schemes contains a free service to help you resolve your dispute – these are commonly known as Alternative Dispute Resolution (ADR) services. You can find out more information about how to dispute any unreasonable deductions your landlord may make in the NUS Tenancy Deposit Enforcement Pack at the NUS website. http:// www.nus.org.uk/PageFiles/3080/Deposit_Recovery_Pack.pdf The Student Advice and Representation Centre can provide further advice and assistance should you have a deposit dispute with your landlord. We can help you draft letters and/or write to your landlord, and provide advice and assistance when making a claim through a dispute resolution service or the County Court.
Student Advice and Representation Centre B Floor, Portland Building, University Park Nottingham, NG7 2RD Tel: 0115 846 8730 Internal: 68730 Email: firstname.lastname@example.org www.su.nottingham.ac.uk/advicesupport/ All SARC leaflets are available in alternative formats. Please ask a member of staff if you require this leaflet in an alternative format.
student advice & representation centre