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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|
|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|
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.
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