Comparing Tenancy Deposit Protection Costs for Landlords

Comparing Tenancy Deposit Protection Costs for Landlords

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Comparing Tenancy Deposit Protection Costs for Landlords

As a new tenancy deposit protection scheme opens for business, some landlords may be confused over the costs and benefits each offers.

To help compare the schemes with each other, here’s a look at the costs and some other important points to consider:

Tenancy deposit protection schemes compared

Deposit Guard The Dispute Service MyDeposits Deposit Protection Service
Deposits over £500 £22.50 £24.00 Free
Deposits up to £500 £15.00 £16.50 Free
Deposits over £300 £30.00 Free
Deposits less than £300 £17.50 Free
Lodge deposit No No No Yes
Landlord direct account Yes Yes Yes Yes
Scheme registration fees Free Free £60 – £20 for NLA members
Landlord group costs £75 – £95 a year £98 a year – NLA discounts longer membership
Estimated cost for landlord joining scheme and protecting 2 x £500 deposits in a year £105 £33 £178 Free

Notes:

RLA – Residential Landlords Association
NLA – National Landlords Association

From the table, the headline fees charged by the RLA are attractive – especially if you are already an RLA member, you have a larger portfolio or you feel you would gain additional benefits as a result of being an RLA member.

Any fees for protecting deposits less than £300 are not relevant to most landlords as few agreements are for less than £500.

The law says any deposit taken under an assured shorthold tenancy agreement with a total annual rental income of less than £100,000 must be protected under one of the three government approved schemes.

This includes DepositGuard as the scheme is managed by The Dispute Service, which has the necessary approval.

Tenancy deposit protection rules are due to change in April. The requirement for a landlord to protect a deposit remains the same, but the penalties for failing to do so are due to become more severe.

Comments

6 years ago

I think I much prefer the mydeposits scheme as this is the only one that allows me to get my sticky fingers on the deposit monies.
Any dispute etc regarding return of deposit amounts may proceed; but at least in the mean time I will have the monies to assist my circumstances.
In my experience it is a lot harder to get money out of me; but it is even harder for me to get money out of other deposit schemes.
I will therefore continue to pay a fee and only use mydeposits.

Mark Alexander

6 years ago

Hi Paul

Please take another look at the table above. Three of the four schemes allow you to hold onto the deposit. It's only the DPS Custodial Scheme which doesn't.

6 years ago

Oh if this is the case I was unaware of this
Are you absolutely sure of this info.
Where have I picked up the understanding that it is only mydeposits which allows the Landlord to hold the deposit monies themselves.
If they are cheaper than mydeposits I will check this situation out.
Thanks for the advice; I will now check these different deposit schemes out.

Mark Alexander

6 years ago

Yes Paul, 100% certain. The analysis is all done for you in the table above

matchmade

6 years ago

I used to use MyDeposits, until they refused to cover multi-occupancy houseshares: I was expected, if a houseshare tenant left, to return all the deposits and start a new tenancy agreement for everyone. Understandably my remaining tenants would not agree to this, as it forced them into a new six-month AST period, and I thought it was outrageous too.

I've switched to the DPS, who are much more sensible about this.

Does anyone know how TDS and DepositGuard handle unlicensed HMOs?

6 years ago

Surely all you had to do is charge the new tenant the £30.00 fee for the nes DPC.
Why would your tenants object to a new AST unless any were planning to leave before 6 momths elapsed.

6 years ago

As I understand there is nothing stopping you writing into the new tenancy agreement that a tenant does not have to wait 6 months before terminating it, you just can’t give yourself the option of terminating it in the first 6 months.

6 years ago

I thought most AST's were run for 6 months at which point they may be renewed for another period determined by the landlord.
I would not normally  give an AST for a lessor period; bearing in mind Section 8 procedures really need a 6 month period AST.
I allow all my AST's to proceed onto a SPT.
If I wish to enforce  an AST termination then that will occur the day after the tenancy has terminated as the Section 21 notice will have expired so I may commence possession proceedings the following day.
I advise tenants that the tenancy will be proceeding onto a SPT.
If they requested another 6 month AST and I was happy to do so I would issue another 6 month AST; but with the tenant/s paying for another DPC.
But as the LL surely as suggested you may write the AST for any period you like taking into account all the issues about giving notice and possession etc.

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