Deposit protection, is there another option?

[Grampa]

The requirement to protect deposits is becoming a minefield with court cases moving the goalposts all the time, is it time to look at other options?

1 You could just not take a deposit

2 You dont take a deposit but get one or even better 2 good guarantor's in place.

3 Only rent out to HB tenants and use their deposit bond scheme.

4 Increase the rent by say £25 pcm and take the risk that the tenant stays at least 18 months which would give you a big chunk towards any damages or arrears. Also maybe take a guarantor. If no damages you get a bigger return.

Another option I have heard is to take the credit card details of the tenant but not sure how you would do it. The more mature members will likely remember when you used to hire a car the company would swipe your card with a mechanical clunky swipe machine that was loaded with a carbon slip. You would then sign it but no figure entered but if you damaged the car the hire company would enter the amount later.

I like the sound of this but not sure if you can still use these machines, also how long can you keep the slip before using it (I guess it could be renewed with every ast renewal) and will it be honoured if the CC is cancelled by the tenant?

[Grampa]

Just spoke to barclaycard about the credit card idea and its not possible as only hire car companies and hotels can use that method.

Another thought is to not use a assured shorthold tenancy but an assured tenancy but the downside is you cannot use a s21 but you can still use a section 8.

I feel like i maybe searching for the Holy Grail.

[Carryon Regardless]

1. Easiest and without complication, but no incentive for the T to behave.

2.. If 2 G'tors I assume each would have responsibility toward the total LL claim. How would a court proportion the liability, is this then 50/50 (where capable) ?

3. I don't trust bond schemes anyway and most are only for the initial fixed period as I understand.

4. The rental becomes uncompetative I find I am reducing rents to reduce voids.

It's nice not to have T's to change nappies for but now I've to pay for all overheads, council tax being the latest.

I considered taking additional rent and returning a lump each Xmas in return for an ideal run tenancy, it's an accruing deposit. We would than need to administrate each additional payment as it arrived.

[Grampa]

1. Easiest and without complication, but no incentive for the T to behave.

2.. If 2 G'tors I assume each would have responsibility toward the total LL claim. How would a court proportion the liability, is this then 50/50 (where capable) ?

I would say each is liable for 100% and would be up to the landlord which guarantor to chase first.

3. I don't trust bond schemes anyway and most are only for the initial fixed period as I understand.

These bond schemes vary from council to council but for my council the bond lasts as long as the tenant is in the property and I have found it very easy to claim on.

4. The rental becomes uncompetative I find I am reducing rents to reduce voids.

Your not wrong

It's nice not to have T's to change nappies for but now I've to pay for all overheads, council tax being the latest.

I considered taking additional rent and returning a lump each Xmas in return for an ideal run tenancy, it's an accruing deposit. We would than need to administrate each additional payment as it arrived.

Rather you than me, I think it could get messy if you were to evict via s8.

[Carryon Regardless]

I would be interested to learn the feasibility of the 2 G'tor idea. I can imagine a judge becoming confused if the 1st G'tor claimed against defended by saying all the debt wasn't theirs. I recall a judge saying that he thought he should defer proceedings so the G'tor could seek legal advice so we have a good idea of where sympathies are generally.

I've only been requested to accept a bond in Denbighshire, 1st was a Shelter bond and a later applicant a council bond. Since Shelter will accept the word of a T as gospel I see no reliability in that one. The council would only cover the 1st 6 months, now since it's unlikely to evict a T in the 1 st months they're off the hook by the time you are likely to achieve eviction.

The idea of returning dosh and thereby creating incentive for good behaviour recognise as a non starter due to deposit legislation.

Tricky this innit.

[Grampa]

I may be missing something but surely it is the same as joint tenants? You claim off either one or both at the same time with one being the second defendant. Of course the wording of the deed of guarentee plays a big part also.