One of the biggest problems that seems to crop up time and time again, is the problem of landlords failing to protect deposits within the 30-day time limit. Or, if they do this, failing to serve the prescribed information.
To their horror, landlords who thought that they had done the right thing by protecting the deposit, find that by protecting it two days late:
- They can’t serve a valid s21 notice without refunding the deposit money and
- Their tenant can go to court and get a penalty award
In many cases, this seems unduly harsh on landlords.
However, there is now another way. It’s a service called Reposit.
How Reposit works
In this new service, the tenant pays a non-refundable payment of one weeks rent to Reposit. As it is non-refundable, this cuts out the tenancy deposit rules as these only apply to deposits – which by definition, must be a payment which is refundable.
- Reposit then guarantee the landlord to cover damage and loss up to six weeks rent worth.
- At the end of the tenancy, the landlord notifies reposit and the tenant of any damage. If this is not challenged by the tenant, the money is paid within 5 days.
- If the damage is challenged, then it goes to adjudication in the normal way.
- If the tenants are found to be in the wrong, they have to pay the adjudication fee of £120 and any money due to Reposit.
- Reposit will pay out the damage to the landlord as appropriate.
- Any money paid to the landlord is then reclaimed back from the tenant by Reposit.
- Any damage in excess of six weeks worth will need to be reclaimed by the landlord from the tenant separately.
It sounds like a good system and apparently they have just received seed investment of £400,000 to develop the business.
Letting agents are being encouraged to promote the scheme by receiving commission – plus it is less hassle than the traditional deposit schemes.
Has anyone used this? How did you get on?
You can find out more about the service from their website here.