Deposit/ Rent Arrears

[wildhayleys]

Hello, we have taken over as the agent for this landlord. We have found that he has received agreement from the sitting tenant that he can use his deposit to cover his rent arrears. The tenant is 3 months in arrears, and this will cover at least one month.

Our worry is that the Landlord had never placed the deposit into a DPS.

By using the deposit for arrears, the Landlord believes that there is in effect no deposit paid.

Is he correct?

[Mortitia]

No, he took a deposit, tenant knows this and he should have protected this if tenancy started after 1st May 2007. Landlord leaves himself wide open to tenant taking him to court for non protection and a 3Xdeposit fine which will be paid to tenant - that should cover his arrears .LOL!

You mention' sitting tenant' do you really know what that is? Or is this tenant on an AST.

Are you learining as you go along?

Mortitia

[wildhayleys]

No, he took a deposit, tenant knows this and he should have protected this if tenancy started after 1st May 2007. Landlord leaves himself wide open to tenant taking him to court for non protection and a 3Xdeposit fine which will be paid to tenant - that should cover his arrears .LOL!

You mention' sitting tenant' do you really know what that is? Or is this tenant on an AST.

Are you learining as you go along?

Mortitia

Thank you for being patronising. I am a mere admin assistant in a Letting Agency, well it is less work that flipping burgers for a girl like me. I was on my own in the office, I wanted to seek advice not belittling.

Have a nice day

[Lyndon]

Wildhayleys

Firstly the advice given to you was probably not meant to patronising but, had you explained your position and reasoning, then I would certainly say that this is a question your employer should have been able to answer. I suspect that you are referring to the current tenant under a recent AST rather than a sitting tenant in a protected tenancy but as a newbie you may have used the wrong phrase. We all make mistakes when we start - that is how we learn.

If the agreement to use the deposit as rent was in writing then it may be taken in lieu of rent BUT if it has not been protected as Mortitia points out, then the tenant may decide to claim 3x the deposit from the landlord. A S21 notice may not be issued if the deposit is not protected when required to do so but the tenant may be issued with a S8 notice for rent arrears.

As for being a "mere admin assistant" don't knock the admin assistants! They are often invaluable to the company and I started in Lettings as one and now own my own company.