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From 6 April 2007, all deposits (up to the level of £25,000) taken by landlords and letting agents for Assured Shorthold Tenancies in England and Wales, must be protected by a tenancy deposit protection scheme. The Tenancy Deposit Scheme comes into force on the 6th April 2007. If you have not protected a tenant's deposit you will be ordered to repay three times the amount to the tenant so find out how you can protect deposits and resolve disputes. Why protect deposits? Deposits are protected to ensure:
Letting a property from 6th April 2007 From 6 April 2007, when a landlord or letting agent takes a deposit from a tenant, the deposit must be protected in a government-authorised tenancy deposit scheme. This new rule applies if the tenancy is an assured shorthold tenancy. Moving in At the beginning of a new tenancy agreement, the tenant pays their deposit to their landlord or agent as usual. The landlord or agent must then ensure it is protected. Landlords and agents have a choice of three schemes providers, offering two types of scheme to protect the deposit. Custodial schemes Insurance-based schemes
Within 14 days of taking the deposit, you must provide your tenant with details of how the deposit is being protected including:
Tenants have a responsibility to return the property in the same condition they took it on. Moving out At the end of tenancy the condition and contents of the property should be checked against the agreement made at the start of the tenancy. The landlord or agent then agrees with the tenant how much of the deposit will be returned to them. Within 10 days the agreed amount of the deposit will be returned to the tenant. Resolving disputes If no agreement can be reached about how much of the deposit should be returned, there will be a free service to help resolve disputes offered by the scheme which is protecting the deposit. |
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