Residential Letting Agents and Property Management Specialists

Forum Lettings of Blandford Forum would like to remind all landlords renting out their property to tenants on Assured Shorthold tenancies (with the tenancy commencement date starting on or after 6^th April 2007) that they must soon belong to one of the three Tenancy Deposit Protection Schemes approved by the Government. With this legislation now only a matter of weeks away, some landlords are still unaware of the new laws shortly coming in to force and some are unclear as to which of the three alternatives available is best for them. Any landlord or agent taking a deposit on or after 6^th April, which they do not protect by joining an authorised scheme, will be breaking the law. This may result in them being unable to regain possession of the property using notice-only grounds for possession and they could be liable to pay the tenant three times the amount of the deposit held.

Two of the proposals recognised by the Government offer an insurance-backed scheme, one instigated by the Association of Residential Letting Agents and the other by the National Landlords Association. Either one of these allows the agent or landlord to continue to handle the deposit, but cost money to join. The alternative is the Government-backed custodial scheme. This is free to join but the deposit must be handed over in its entirety within 14 days of the start of the tenancy to the Deposit Protection Service run by Computershare Investor Services; a third party organisation appointed by the Government to hold all such deposits. The final alternative is not to take any deposit at the start of the tenancy from the tenants at all, which is not something that Forum Lettings would recommend.

In the event of a dispute at the end of the tenancy involving deductions that an agent or landlord wish to make from the tenant’s deposit, all three schemes offer free, independent and impartial arbitration services. If the deposit is held under one of the two insurance-backed schemes, the disputed amount must be handed over to the relevant scheme until the dispute is resolved. If the deposit is held by the free custodial scheme, the dispute will be resolved by arbitration within 28 days of all the evidence being assembled.

For more detailed information about the Tenancy Deposit Protection, please visit Forum Lettings’ site at www.forumlettings.co.uk where they have a much more detailed analysis of each scheme, which will enable landlords to make an educated choice about what method to choose. For all other queries, please call them on 01258 459600 or visit their offices at 1 Georgian Passage, East Street, Blandford Forum.