5 Weeks Deposit and Pet Deposits

by Readers Question

10:43 AM, 13th January 2020
About 11 months ago

5 Weeks Deposit and Pet Deposits

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5 Weeks Deposit and Pet Deposits

Hi fellow landlords.. just trying to keep up with the changes.

I have a couple of existing tenants who thankfully are very nice. When they moved in I took 6 weeks rent as their deposit and an additional pet security deposit of £300.

My questions are as follows:

Do I need to return their extra week of deposit monies to the tenants by June?

If I do… do I need to alert and adjust the figure with Mydeposits (govt ref scheme and… will they try to charge me for the privilege?)

Do I also have to return the additional £300 pet deposit protection? Or is Jenrick’s proposal one to simply ‘encourage’ ll’s to consider pets… and additional pet security deposits are still allowable (guessing from the thread I have just read on this site; most people believe the 5 weeks cap applies from June and it includes additional pet deposits).

Am I legally allowed to increase the tenants rent to cover the risks/costs of having a pet (is there a guide re what is considered reasonable)?

Finally – one lot of tenants rent their house from us and separately a horse field at the rear of the property. I have a tenancy agreement for the house and garden (where they have 2 dogs and some chickens) and from the outset they have always had a separate Field Rental Agreement for the land/their horse. Does the 5 week cap apply to field rents do you know? If it is separate I hope to keep the deposit as it is (which is more than 5 weeks of the field rent).

Appreciate your guidance!

Maria


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Neil Patterson

10:48 AM, 13th January 2020
About 11 months ago

The Ministry of Housing, Communities & Local Government official guidance notes >> https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/819634/TFA_Landlord_and_Agent_Guidance_190722.pdf

“What fees can I ask a tenant to pay?

You cannot require a tenant (or anyone acting on their behalf or guaranteeing their rent) to make certain payments in connection with a tenancy. You cannot require them to enter a contract with a third party or make a loan in connection with a tenancy.

The only payments you can charge in connection with a tenancy are:

The rent
A refundable tenancy deposit capped at no more than five weeks’ rent where the annual rent is less than £50,000, or six weeks’ rent where the total annual rent is £50,000 or above
A refundable holding deposit (to reserve a property) capped at no more than one week’s rent
Payments to change the tenancy when requested by the tenant, capped at £50, or reasonable costs incurred if higher
Payments associated with early termination of the tenancy, when requested by the tenant
Payments in respect of utilities, communication services, TV licence and council tax; and
A default fee for late payment of rent and replacement of a lost key/security device, where required under a tenancy agreement
If the fee you are charging is not on this list, it is a prohibited payment and you should not charge it. A prohibited payment is a payment outlawed under the ban.

What does this mean for existing tenancy agreements?

If a tenancy agreement was entered before 1 June 2019, you can continue to require a tenant to pay fees written into that agreement (e.g. check-out or renewal fees) until 31 May 2020.

After 1 June 2020, the term requiring that payment will no longer be binding. Should you, in error, ask a tenant to make such a payment, you should return the payment immediately and must return this within 28 days. If you do not return the payment within 28 days, you will be treated for the purposes of the Act as having required the tenant to make a prohibited payment (a payment that is outlawed under the ban).

You do not need to return any amount of tenancy deposit that is over the cap for tenancy agreements that were entered into before the Tenant Fees Act came into force.”

Paul Hawkins

14:22 PM, 13th January 2020
About 11 months ago

I was just about to post a similar article.

One of my rental properties is currently up for rent. I generally do not allow pets, however, due to the lack of enquiries, I am considering allowing pets such as cats.

I have had a number of potential renters approach me, with variations of the same request - " Can I pay extra deposit" to cover additional risk - to which I am having to respond that I can no longer accept more than 5 weeks rent or include a clause in the tenancy agreement to ensure that they professionally clean or de-flea the property at the end of the tenancy.

This is so frustrating both to me as a LL and potential tenants - I am sure that this will become more apparent as an unintended consequence of the letting fees ban, as time goes on.

Its sad that for both genuine tenants and landlords that we cannot by mutual agreement take additional deposit protection to mitigate risks - especially when both parties are willing.

SimonR

15:51 PM, 13th January 2020
About 11 months ago

if you keep the tenants on a periodic tenancy then you don't have to do a thing, deposit can stay at 6 weeks and you can also retain the pet deposit. Should you agree a new fixed term then you would need to refund all deposit monies over 5 weeks, this includes the pet deposit and also notify the deposit scheme you are registered with of the new deposit amount.

The Forever Tenant

16:05 PM, 13th January 2020
About 11 months ago

I have two cats and when I was last looking for accommodation it was difficult to find anywhere that would accept myself and them.

Instead of offering a higher deposit, I was more than willing to offer higher rent for the ability to house my cats. Even in that case landlords were reluctant.

Strangely, the landlord I eventually ended up with declined all my offers of both higher rent and higher deposit (this was before the TFA was a twinkle in a politicians eye).

I would suspect that most prospective tenants with pets would be willing to increase their rent accordingly with full knowledge that they would be unlikely to find another place.

Paul Hawkins

16:49 PM, 13th January 2020
About 11 months ago

Reply to the comment left by The Forever Tenant at 13/01/2020 - 16:05
Thanks - its always useful to hear from a tenants perspective.

paul kaye

19:35 PM, 17th January 2020
About 11 months ago

There are so many regulations made by people who do not own my houses !
making you allow pets,well are they going to clean up and pay for the damage ?
I now raise my rents to cover pets and extra insurance.
Obviously if damage is done they will still have to pay and will have their deposit deducted to cover all costs.The insurance is for my protection.I have been left with fleas many times and the tenant is made to pay.
Now with electrical checks to pay for ,rents will go up again.
Is there no end from the government ? soon rents will be so high,all down to the government.
will sell up soon and let the government house my tenants,this is the very least I can do for the government.!


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