However, any ‘short-hold tenancy’ taken out from April 2007 is now affected by Tenancy Deposit Protection (TDP), which was set up by the government to protect tenants from unscrupulous letting agents and landlords keeping hold of tenants’ deposits without just cause.
TDP requires all landlords or letting agents who collect deposits to join a statutory scheme to ensure that tenants get their deposit back, if they have kept the property in good condition. If the letting agent or landlord is in dispute with the tenant over how much of their deposit should be returned, the matter is mediated by an independent disputes solving service.
There are currently three authorised tenancy deposit schemes, which provide free dispute resolutions services in the event of a dispute over the return of a deposit. Two of these schemes are insurance based, where as the third is custodial based.
Regardless of which scheme your letting agent or landlord is signed up to, the tenant will always pay the deposit directly to the landlord or letting agent in the usual way. Under the insurance-based schemes, the landlord or letting agent keeps the deposit and pays a premium to the insurer.
However, under the custodial scheme the landlord or letting agent pays the deposit directly into the scheme. It’s the landlord’s or agent’s responsibility to let you know, within 14 days of receiving your deposit, which scheme your deposit is protected by.
The three companies authorised by the government to run the tenancy deposit schemes are:
My Deposits – Insurance scheme
Tenancy Deposit Scheme – Insurance scheme
From April 1 2013 two additional schemes were also approved, they are:
Capita Tenancy Deposit Protection
As it is a legal requirement for your landlord or letting agent to protect your deposit, you can apply to the county court to force them to protect it if you think it might not be protected by one of the schemes. If they find that your deposit hasn’t been protected, then the court must order your landlord or letting agent to repay you three times the value of the deposit you paid.
For more information about Tenancy Deposit protection visit: gov.uk/tenancy-deposit-protection/overview