Is a Holding Deposit binding or refundable?

[T.M.]

Hi people.

Can anyone help with this as i aint really had to deal with it before.

If someone wants to view a room, and they like it and want me to hold it for them till they move in a little further down the line, say in Sept 05 ish,

What sort of deposit could i take for it?

If they do decide to move in when its time, is that accepted as deposit/ 1 months rent?

Is it be 'Non returnable' if they change mind much later on? (since ive been refusing it to be let out meanwhile)!

Thanks for any response people. Really helps.
T

[Paul_f]

I've written so much on this subject on the old forum perhaps you might want to take a peek?

September seems a long way away [is he/she a student?] You need to do the following:



Put all the terms of the tenancy in writing concerning the deposit (you don't need the actual AST here).
You can't retain it as a penalty against the prospective tenant.
Always use the term "Subject to Contract" in your correspondence.
If the applicant fails to take up the tenancy on a certain date or fails the referencing (don't forget this) you can only mitigate your loss i.e. the actual
financial loss to you, not a figure plucked out of the air.
Make sure you don't pay any interest on the money held!
If the applicant fails to take up the tenancy but he/you find a replacement then you ahve to give him the money back.
You can make an administration charge but make it an hourly rate [say £20] and you must tell him/her in advance what the maximum will be in GBP's, and it MUST be reasonable.

Hope this helps. :)

[Kila]

I've had a quick look around the site for the answer to this question but can't seem to find one.

Having found some really nice tenants who passed their reference checks etc with flying colours and ticked all the right boxes with regards to what we want in a tenant we happily offered them an AST only to be told they could not move in straight away. Not a problem, I took advice and told them that we would take it off the market if they were prepared to show goodwill by paying a holding deposit to the tune of 1 weeks rent for every week we held the property for them. Fortunately they were more than happy to do this and promptly produced a cheque equal to one months rent, which we agreed would be used as the first months rent when they took up the AST. Next thing we know they are saying they want us to hold the property for a further two weeks and once again produced a cheque.

The question is; although we agreed we would use the first cheque against the first months rent we did not agree the same for the second payment, do we have to refund the second payment?

I have no wish to upset these tenants in anyway but by holding the property for six weeks we have potentially lost revenue. Are we allowed to recoup some of these potential losses or is there some legal reason preventing this?

Any advice would be appreciated.

[Paul_f]

I would answer the question with another question. What will you do if they withdraw leaving you without a tenancy?

[Kila]

I would answer the question with another question. What will you do if they withdraw leaving you without a tenancy?

Good question!
Fortunately that isn't an issue as they have signed the AST this week but had the worst happened; in all honesty I would probably still be checking the legal position. This is the first time of doing this on our own and I want to be sure we're going about it the right way. Point taken though.

[David TFP]

The trick here is simply to ensure you have a written contract specify the facts.

For example, how long will you hold the property for? What deductions might be made from the money (lost rent, reference costs etc), what circumstance might trigger these costs (eg tenant not taking the property by the agreed date) etc.

This will then give a firm contractual basis from which you can discuss further extensions to the time but under an new agreement.

You have ben kind and generous and have simply lost the rent to save them the money. There is no reason they could not have taken on a tenancy of the property at the end of the first month, even if they did not move in for another 2 weeks (you don't have to live in the property to be a tenant!).

[Kila]

Thanks David.

We did send a letter specifying the facts you mention and more including that only the equivalent of one months rent would be credited to them however long we agreed to hold the property for, so I guess by dint of the fact that they paid up a contract was formed and accepted. Therefore there is no recourse to be had.

[Jayne]

Hi, I've looked through previous posts on the topic of 'Holding Deposit' but still not found the help I need with this. On the Landlord Zone Tenancy Application Form (page 5) which I was going to use with my prospective tenant it states ...

'I understand that if I lodge a holding deposit I will be given a written receipt and details of any penalties should I fail to commence the tenancy. Also that the holding deposit will be credited as a portion of my security deposit or rent once the tenancy commences'.

All well and good but is there any standard text that I can use on my receipt relating to 'details of any penalties' or indeed a 'standard holding deposit form' which covers all of this that both myself as LL and my prospective tenant can sign? Thanks for any information.

[Jolanta Nowak]

I assume that the ability of a landlord to insist on an upfront 'holding deposit' is unaffected by recent legislation?

Are there any limitations to the size of such a deposit, does anyone know?

[Paul_f]

The costs shoud be reasonable if any are to be deducted, and does any of this money go towards the first months rent? Also the landlord would not be able to retain all of this money if you were unable to go ahead unless he can show that it mitigated his loss.

Do not under any circumstances pay more than is reasonable, the amount of which I cannot advise as I don't know how much the rent is and how much you are being asked to pay.

[toorisky]

My landlord, through the letting agent, gave me notice last Feb but I refused to go. He employed a solicitor to get an eviction order which has been served - I have to be out by the 12th August or face the bailiffs. I have paid the rent in full and the house is in good shape.

The agent now tells me that the landlord has requested the deposit be given to him as he is out of pocket - he cant claim solicitors fees only fixed costs. He is quoting Section 2 of the AST agreement :

" the tenant pays the deposit as security for the performance of the tenants obligations and to pay and compensate the landlord for any breach of those obligations "

He says that I have not met my obligation to vacate the property when requested. Can he do this please?

[johnboy]

The L/L should not end up out of pocket due to a tenant. If you were given a correct valid legal notice to quit and decided to stay you wont get any sympathy from me. I am basing that opinion on the info supplied.

[Paul_f]

Landlords DO NOT serve a Notice to Quit but a Notice Seeking Possession (NSP) i.e. a S.21 Notice. The only way a tenancy can be brought to an end legally is by an Order of the Court which has been obtained. The tenant hasn't breached anything if he's paid rent and is moving out on 12 August. He will probably be liable for the fixed court costs, and any dilapidations assessment.

[toorisky]

What he is saying is that he gave me 2 months notice in Feb and I failed to leave. Then a Section 8 was issued and I ignored it, then a Section 21 was ignored and THEN a solicitor was used to get the court order. HELP!

[Paul_f]

No, you've got it all wrong.

[johnboy]

What he is saying is that he gave me 2 months notice in Feb and I failed to leave. Then a Section 8 was issued and I ignored it, then a Section 21 was ignored and THEN a solicitor was used to get the court order. HELP!

I suggest you leave the property asap and think yourself lucky you may only lose your deposit.

DONT BURY YOUR HEAD IN THE SAND NEXT TIME

[alidee]

I took a £50 holding deposit on a room which I let.
The tenant also paid my agency fee.
He has now disappeared dispite me calling him (leaving messages) and quite a few texts.
I have now re-let the room as I told him I would if he didn't contact me - this has probably been a month now trying to get hold of him.
Now what do I do with his £50 holding deposit that he paid? Do I have to return it to him or is the landlord entitled to it ?
thanks for any answers :rolleyes:
Alidee

[Paul_f]

I shouldn't worry too much about it as he's unlikely to return. If he does you will have to deal with it but you don't appear to have offered a contract. Is the deposit part towards your application costs - he isn't a tenant until he takes up occupation?

[alidee]

The £50 is taken as a deposit to secure the room and then deducted from the first months rent. He has paid my agents fee but I don't have any conscience about keeping that as I paid to credit check him and carried out full referencing.
If he doesn't reappear though do you think it should be given to the landlord or is it mine to keep? Just that it's sat in my client account at the mo so not sure how to account for it.
Thanks
Alidee

[Paul_f]

I would cover the cost of the referencing first which I trust you paid for indirectly and £50 appears reasonable.

[Ben Wren]

Hi

A friend of mine was dealing with a letting agent regarding flat they wished to rent. She and her friend together gave the letting agent £1000 as a "holding fee" on the flat. However, they did not disclose the fact that they would charge £400 for some sort of admin fee, I think related to obtaining references. She and her friend want to withdraw from the deal. They haven't signed a contract, but the letting agent says they will not get the £1000 back if they don't go through with the deal.

In addition to asking for this additional fee, my friends did not receive any paperwork from the letting agent regarding the holding fee, except for a receipt which they had to ask for. Plus, the amount which they asked for to hold the property seems extremely high - they say it is their standard policy, but most holding deposits mentioned on the web seem to be around £100-£150.

Is there any way my friend can get all, or at least some of this money back? Can she get it all back on the grounds that they did not disclose an additional charge? And/Or on the grounds that they haven't provided any information about the holding fee, what the agent will do with it, or their rights regarding this money? If so, how should she go about this if they have already talked to the letting agent and been told they won't give the money back?
Or can she get she get some of it back on the basis that it the amount is far greater than any costs the agent will incur as a result of them pulling out of the deal? Again, what is her best course of action, assuming non-cooperation on the part of the letting agent?


Thanks very much
Ben

[alidee]

Not sure I made myself clear ? He paid £50 to hold the room. He also paid my agency admin fee seperately, which paid for the referencing and credit checking I did. Bit concerned about keeping the £50 holding deposit as not sure how I would account for it ?
Alidee

[Paul_f]

Contact your local Trading Standards Office or Consumer Direct who might well take up your case.

You are entitled to know all financial committments in advance of your parting with any money under (I think) the Supply of Goods & Services Act 1982. The agent might be able to charge "reasonable" administration charges but to retain all of the money is outrageous

[Poppy35]

we always give our applicants guidances notes which sets our what the fee is and how much is refunded should the tenancy not proceed due to bad references etc - its depends what your terms are that the applicant signed?

[alidee]

He passed all his referencing fine - its just the holding deposit I have. I am keeping my agency fee for the referencing as I kept my part of the bargain.
Now have a new tenant for the room just an extra £50 sitting in my client bank account :rolleyes:
Alidee

[Wazz72]

My partners daughter is moving area to where we live. She has had problems with her previous flat, where she contacted the letting agent several times with regards to damp in the property.
Upon collecting her I photographed and found the following:

Mould spores growing on most walls.
Mould spores growing in dry food storage areas.
mould growing on furniture.
Rust on light fittings.
Rusty washing machine not working full of stagnant water.
Rusty Fridge freezer, covered in mould spores.
Damp marks around most of celling.
Damp around entrance.
Mould growing on tennants posessions.

The letting agent and landlord have not done anything to rectify this despite lots of phone calls over the past 6 months regarding the damp and the broken washing machine. In the end she witheld on paying the rent until something was done about it.
In adition to this she and her 4 year old son have been suffering from chest complaints and colds off and on since moving in in the summer.
She has since moved out, and is planning to take the letting agent to arbertration to try and recover some of her money.

Since this incident she has paid a local letting agent a holding deposit on a house.
The letting agent was informed about the dispute with the previous letting agent at the time of paying the deposit, but a week after taking it has contacted the other agent and has decided not to proceed.
The agent is now wanting to pay back only 50% of the deposit, after they pulled out, and my partners daughter has been left homeless.

Where does she stand on her holding deposit?
Who else should I contact on the state of her previous flat? (Environmental Health Dep?)
I am also a landlord with several propertys in my area, and cannot believe the state that this property has been let at to a young girl with a child. It has abviously been given a coat of paint in the summer when it is dry to cover up the damp.

[powellk]

The thing I hate about this is the agencies part in all of this.

Yet again this proves, these companies excist purely to take money without any responsibility.

The owner, may have many properties, but he has a responsibility also. Especially if anything more serious would've happend with the child, then I'm sure some kind of criminal negligance would be raised.

Good luck !!

[Wazz72]

Anyone have any Ideas on where she stands on getting her holding deposit back? as the agency pulled out before running any computer checks etc.
I assume shes entitled to the full holding deposit being returned.

[Wazz72]

Can an agent keep a holding deposit if they cancel the agreement?

Thanks
warren

[MrShed]

Define "cancel"?

Are you landlord or tenant?

[Wazz72]

In this case I would be the tennant. I have not moved into the property, I have given the agent a holding bond. To take the property off the market. A week later he has cancelled the areement, and wants to keep the bond.

[MrShed]

Why did he cancel the agreement? What does it state on the receipt? How long before you were due to move in did he cancel?

[Wazz72]

The estate agent was told of a previous agent from another area, who the tennant was in dispute about the state of the accommodation with. The agent took the holding deposit, contacted the previous agent whom the tennant had a disagreement with, and a week later after only speeking to the previous agent cancelled the agreement. The disagreement was due to damp and the state of the flat which the agent was told about from the beginning.
It was cancelled aprox a month before the existing tennant was supposed to move out.

[MrShed]

Was the tenancy subject to reference? IE were you explicitly told this?

[Wazz72]

No, they wernt told this. They were told about the other agent right from the beginning, and told that they would not be able to recieve a fair reference from them. Afterwards they were even shown evidence and the state of the previous property.

[Summer]

Firstly, can a Landlord charge a Reservation fee, as opposed to a Deposit ( A reservation being a whole month's rent), or is this an unrealistic loophole?

A tenant was adament to take a room and paid this Reservation fee, however due to her circumstances has never been available to sign a contract with the landlord, and the only document she holds is a reciept of the reservation payment. Day 1 of moving in, her boyfriend also stays the night. The landlord claims that when the tenant came to initally view the property, he'd specified no guests or b/friends to stay overnight.

However as a contract was not signed nothing is holding this claim.

After a week or so the tenant moves out (on her own will down to the fact that her boyfriend can't stay overnight at times) and wants back her Reservation money. Is the landlord legally permitted to hold these monies until the room goes on let again?

Do you advise that the tenant goes to the Small Claims court to pass a Judgement on the Landlord? What do you think are her chances in getting back her Reservation money?

[jeffrey]

The crux is: did the Reservation Fee payment (and written Receipt) create a binding contract? What did that Receipt state?

[Summer]

The reciept is a small brief slip. It confirms the amount paid, the address of the property it relates to and confirms payment in Cash and has been signed by the Landlord.

It does not state Reservation payment or anything of that nature

[jeffrey]

The reciept is a small brief slip. It confirms the amount paid, the address of the property it relates to and confirms payment in Cash and has been signed by the Landlord.

It does not state Reservation payment or anything of that nature
OK- so it's not in law a Reservation Fee receipt, is it, and it does not oblige anyone to do anything.

[Summer]

The reservation was to be used as her first month's rent. Sorry call me slow, but who has the upper hand in this? I dont think I was aware that there is a special reciept for collecting a Reservation fee. Is there?

[jeffrey]

The reservation was to be used as her first month's rent. Sorry call me slow, but who has the upper hand in this? I dont think I was aware that there is a special reciept for collecting a Reservation fee. Is there?
Not as such, no, but I'm trying (and failing) to see how your Receipt contractually obliges L to do anything.

[Preston]

Hi

I may be missing the point here, but the key issue seems to me to be whether a tenancy has been created.

On the basis of the evidence provided it would seem that there has. The tenant has paid a sum of money and, most importantly, has taken up possession. I think you have said that the rent was to be paid monthly. I assume she has exclusive possession of at least one room, that no other services are provided (such as cleaning of her room or cooking) and that the landlord is not resident, in which case it will be an assured shorthold tenancy. As there is nothing in writing, it will be difficult for either party to prove the terms and conditions of that tenancy and in particular whether there is a fixed period and/or a break clause for the tenant, but would be little doubt she would be liable to pay the first months rent. If you are holding the equivalent of a month's rent, then my guess is that you can rely on your common law right of offset (i.e. to offset a credit against a debit) and leave it to her to argue the contrary.

In brief and in answer to your question, then, it would seem that the landlord has the upper hand?

Having said all this, I think it is equally likely that the landlord would have had difficulty in enforcing a "no guests" rule, given that this was not agreed in writing (and its enforceability would be slightly questionable in any case).

Preston

[Summer]

Thanks for your replies.

Well, No a contract was not drawn, everything was done verbally. The tenant simply didn’t have the time to sit down and even get herself the key to the house or room until morning of Day 2 of her moving in. That’s when the Landlord found she had her Boyfriend stay the night. The rule was to have no guests overstaying the night, however day visits were permitted. This would have been clearly stipulated in the Contract of Agreement, which regrettably didn’t get agreed or signed. The tenant resided at the property for 7 with no Key.

I don’t understand what is meant by using common law right of offset (i.e. to offset a credit against a debit)?

After the tenant decided to move out, she has requested a week’s rent be deducted and the rest be handed back, but the Landlord argues that he cancelled a week of bookings and turned down interest from other parties for the room.

If the Landlord was to get an order, what are his chances?

[jeffrey]

Best bet: L deducts what he justifiably wants and refunds balance to T by cheque (or BACS) with WRITTEN confirmation that the refund is in full and final settlement. If T cannot accept that proviso, she cannot bank or retain the funds but would have to grit her teeth and return them (funds, not teeth) to L.

[Summer]

Well this is when it get's interesting, because he now has decided to refund her a only a week's worth of rent as "Goodwill", (when she wants all 3 weeks rent back). The landlord states that the room was taken 2 weeks after she left. However, the point I am making is, is it worth the Tenant place an order against the landlord, is it worth it, does the tenant have an argument?

Bearing in mind, the landlord has used a month's rent as a reservation - what ever that term means.

[Preston]

Hi

I think he probably can do that, yes, assuming that she did in fact have a tenancy and unless something else was agreed between the parties at the time she surrendered her tenancy.

Preston

[jeffrey]

The amount at stake probably makes it not worthwhile for T to press L and seek Court Order or whatever.

[Nelly30]

My agent has been holding the previous tenants deposit, the remainder of which is due to me.

They have refused to hand back the money claiming its for the services I have had done after the tenant vacated.i.e EPC, gas cert and cleaning. I said I will pay for these services when the documents are given to me.

Despite a number of requests, they are not providing me the EPC, Gas certificate, actual cleaning bills. This is added to the fact the new tenant is in occupation but the agent has not even provided me with the AST agreement!!

I have stated that surely it is against the law to withold these documents from me, esp AST and Gas certificate. They have not replied. Also, do they have any right not to return my deposit from the previous tenant?? I would have thought there are rules for handling clients money and they must be in breach.

I think I would have to threaten making a complaint to the NAEA now.

Does anyone know where I stand?

Thanks

[mind the gap]

My agent has been holding the previous tenants deposit, the remainder of which is due to me.

They have refused to hand back the money claiming its for the services I have had done after the tenant vacated.i.e EPC, gas cert and cleaning. I said I will pay for these services when the documents are given to me.

Despite a number of requests, they are not providing me the EPC, Gas certificate, actual cleaning bills. This is added to the fact the new tenant is in occupation but the agent has not even provided me with the AST agreement!!

I have stated that surely it is against the law to withold these documents from me, esp AST and Gas certificate. They have not replied. Also, do they have any right not to return my deposit from the previous tenant?? I would have thought there are rules for handling clients money and they must be in breach.

I think I would have to threaten making a complaint to the NAEA now.

Does anyone know where I stand?

Thanks

Nelly, was the previous tenant's deposit protected in a scheme, or not?

[Nelly30]

Yes..

The tenants deposit was in the agents scheme.

Incedentally, the agents verbally told me it wouldn't cost anything in their scheme and the charged me £30 admin charge!

[Paul_f]

Time for a call to your local Trading Standards Office, and a letter to any Regulatory Body to which the agent might belong! Otherwise it's the Small Claims Court.

[Nelly30]

Thanks Paul.

I guess I will have to familiarise myself with the NAEA rules of conduct however there must be soething there about handling deposits/client money...

[Paul_f]

You can download them from www.naea.co.uk. It probably comes under rule 1(3)

[scotslawyer]

Hi,
Although I know a bit about landlord and tenant in Scotland ,England is foreign territory legally speaking. My son is studying away from home. His latest lease has both a holding fee and a deposit. The holding fee effectively seems to be compensation for the fact that the lease doesn't start until September . So it's not really a deposit but more a claim for half rent labelled a holding fee. During the period the fee runs for there is no right of occupation including none to leave stuff in the property.
I'm not particularly happy about this since it seems to me that he's paying something for nothing and I recall premiums used to be (may still be) illegal.
As I read it in the contractthe "holding fee" is not returnable even after the tenacy commences or indeed is completed.
Any views?

[mind the gap]

Hi,
Although I know a bit about landlord and tenant in Scotland ,England is foreign territory legally speaking. My son is studying away from home. His latest lease has both a holding fee and a deposit. The holding fee effectively seems to be compensation for the fact that the lease doesn't start until September . So it's not really a deposit but more a claim for half rent labelled a holding fee. During the period the fee runs for there is no right of occupation including none to leave stuff in the property.
I'm not particularly happy about this since it seems to me that he's paying something for nothing and I recall premiums used to be (may still be) illegal.
As I read it in the contractthe "holding fee" is not returnable even after the tenacy commences or indeed is completed.
Any views?

Are you sure he has no right of entry at all? My son has a similar contract with half rent for July and August, but the tenants can store things in the property and be in it during the day, but not stay overnight.

If your son cannot enter the property until September, I agree, it does sound wrong.

Has he paid any rent up front as well?

[scotslawyer]

No right of entry. Payments up frontfor deposit and holding fee in May(now due) and then 1st term in September, 2nd term in Jan and 3rd term in April. Lease bears to be from 1st Sept to 30th June.

[agent46]

I agree that the situation seems odd and a bit of a rip off, but from a legal perspective I can't see the problem with it. Rather than looking at the situation from a property law perspective, and getting bogged down in issues of rent/premiums/rights to possession etc, all the difficulties melt away if it is viewed simply as a matter of contract law.

There is a contract to create a tenancy in September. The fee is the tenant's consideration in the contract. The landlord's consideration is his forebearance from letting the property to others.

[mind the gap]

There is a contract to create a tenancy in September. The fee is the tenant's consideration in the contract. The landlord's consideration is his forebearance from letting the property to others.

But the LL can surely not let the property to others anyway, since he has already signed a tenancy contract with OP's son + friends?

[agent46]

But the LL can surely not let the property to others anyway, since he has already signed a tenancy contract with OP's son + friends?

Sorry, I should have been a bit clearer. I was operating under the assumption that the LL was going to keep the property vacant in the meantime. However, even if he isn't keeping it vacant for all or part of that period, the parties are still free to agree whatever they like. In this case they agreed the terms OP has set out in his first post.

Just because something isn't actually a very good deal for one of the parties doesn't mean it is unenforceable. For example, I could agree to sell you my car for £5, and if I renege on the deal, so long as I was sane and not under duress at the time the deal was made, the contract would stand.

Doubtless, however, a certain person will come along and inform us that the OFT have declared these sort of contracts unfair. :rolleyes:

[mind the gap]

Sorry, I should have been a bit clearer. I was operating under the assumption that the LL was going to keep the property vacant in the meantime. However, even if he isn't keeping it vacant for all or part of that period, the parties are still free to agree whatever they like. In this case they agreed the terms OP has set out in his first post.I see. It would have been more candid for the agent to whack the extra charge onto the rent instead of concealing it in the small print, although it is up to the T and his guarantor to read the small print, I suppose.



Just because something isn't actually a very good deal for one of the parties doesn't mean it is unenforceable. For example, I could agree to sell you my car for £5, and if I renege on the deal, so long as I was sane and not under duress at the time the deal was made, the contract would stand. Define 'under duress'!



Doubtless, however, a certain person will come along and inform us that the OFT have declared these sort of contracts unfair. :DI cannot imagine what or whom you might mean!

[agent46]

Define 'under duress'!




Here's a link, although I haven't checked it for accuracy. http://www.lawofcontract.co.uk/contract-duress.php

[JUST_ine]

Hi,

I've got a question regarding a holding deposit.
Me and my partner and our 3 year old were about to move to a rented property on Friday but today ( three days before!! ) I got a phone call from agent saying that it will not be possible. Apparently the house that our LL was going to bought got flooded and since they have nowhere to go we can not move in.

We paid a holding deposit one month ago and provided all documents and ref's but we were going to sing a contract tomorrow.
We can't stay at the place that we rent at the moment and since it's only 3 days left we have no chances whatsoever to find another place.

So basically my question is DO WE HAVE ANY TENANTS RIGHTS since we haven't sign any contract? Is an agent responsible for providing us other place? or compensation for this situation ?
the biggest issue is that we have a little baby and have no where to go at the moment....:[


Thank you for any advise...

J

[lozzag123]

We are a lettings agency and took a holding fee for a property over a week ago from a couple who have now disappeared and the landlord wants us to re-market.

However the landlord wants us to pass over the £200 holding fee taken to her for lost rent.

Where do we legally stand with this? there is nothing to say we pass the holding fee over in the terms & condtions and obviously it has coast us money to chase the tenant etc...

Many Thanks

[jeffrey]

Into what preliminary Agreement did T enter, when paying the holding fee? If there's none, the money belongs to T.

[lozzag123]

The tenant signed our terms and conditions which states they will not receive money back if they pull out, however it is not the tenant asking for the holding fee it is the landord.

[jeffrey]

The tenant signed our terms and conditions which states they will not receive money back if they pull out, however it is not the tenant asking for the holding fee it is the landord.
OK, but- by signing- T seems to have agreed that the money paid as a holding fee is not refundable if T withdraws from the transaction before an AST is granted. If so, it must be L's money now even where (as here) the Tenancy never starts.

[Mrs Jones]

I think what Jeffrey means is that since you, as Landlord's Agent, are representing the Landlord, you are holding the holding fee on the Landlord's behalf, and therefore, if it is forfeited by the Tenant, it belongs to him. Perhaps you should come to an arrangement whereby you deduct your costs and give the rest to the Landlord.

You could, of course, just say no - but where does that leave your relationship with the Landlord...

[lozzag123]

Thanks for the replies.

We have offered to give half back to her but she has stil declined so will see what happens.

[Paul_f]

OK, but- by signing- T seems to have agreed that the money paid as a holding fee is not refundable if T withdraws from the transaction before an AST is granted. If so, it must be L's money now even where (as here) the Tenancy never starts.The OFT frown on this considerably. Neither Landlord nor Agent can withhold applicants money if tenant fails to proceed even if it states that is the case; only "reasonable expenses" can be deducted. If the applicants were to reappear and demand their money then I would be writing out a cheque. If they were to take advice from the TSO you might find that the landlord would be in some diffculty retaining the money, and the agent could be referred to the Ombudsman if they are members of a redress scheme.

[Sandra18]

Hello, I am new to this, so please bear with me. It’s not a huge amount, but we lost £50 to a letting agent in Wales. We had been liaising by phone and email from Spain. We saw a particular property on their website and we contacted them about it on the telephone. We supplied them with a holding fee (£50) and a letter of confirmation. They did not acknowledge receipt of this. After several days, we finally managed to get hold of the agent on the phone, we were advised that they had indeed received our letter and the cheque for £50, but told us that this particular property was not in a good state of repair and that it would be best if they kept our holding fee for the time being so it will be readily available as soon as a property became available. We were more than happy with this as we were assured that there would be a property available for us by the time we flew to Cardiff. We waited and waited and when we were only 12 days away from flying back to Cardiff, we still had not received any confirmation from the agent as to which (if any) property was available for us. We were advised that their literature had been sent out to us, but we did not receive anything, nor did we sign anything. We were so concerned about having nowhere to go, so we booked a bed and breakfast. We advised the agent that we had now made other arrangements so no longer required a property (due to the fact that they had not come up with one!) and they were very pleasant and advised us that they would destroy the cheque as they hadn't committed it to hold any particular property at this point. We even have an email from them to confirm that they had not committed the cheque to any particular property. Later when we were back in UK, we realised that they had indeed cashed the cheque for £50. When we got in touch with them about it, they advised us that the holding fee is non refundable due to the fact that we withdrew from the service! We were advised that a property had been secured for us (although there is no evidence of this) and that it was taken off the market, therefore a refund of the holding fee is not considered appropriate. We’ve been to the Citizens Advice Bureau and have showed them all the emails to and from the agent. They were in total agreement with us. The problem we have is that it would cost us more than £50 if we go to a Solicitor to take this further. It is not the amount of money that we are annoyed about, it is the principle. How many more people have they possibly done this to? It is totally unfair, but where do we go from here? We’ve have been liaising with this agent via email since November 2008 to dispute the fact that they kept our money. They reply to our emails and constantly repeat to us over and over again that a refund is not appropriate due to the fact that we ‘withdrew from their service’. Any help/advice gratefully received.

[Bel]

Tell them it is a breach of the Accomodation Agencies Act 1953 to take a fee from a potential tenant if it is not directly related to a specific property they plan to rent.

This act is enforced by Trading Standards.

Tell them if you do not get a refund, you will go to Trading Standards.

[westminster]

If you really want to, you can issue a claim against them. You don't need a solicitor to do this.

Money Claim Online (https://www.moneyclaim.gov.uk/csmco2/index.jsp)

More guidance here (http://www.hmcourts-service.gov.uk/infoabout/claims/index.htm).

If it goes as far as a hearing, the whole process can take six months or more.

[Jaybee542]

Tenancy agreement with existing tenant (T1) expires on Fri 26 June. L issues Section 21 Notice on 24 April and T has agreed verbally on a number of occassions that he will leave on 26 June.

L instructs LA to find new tenant on 24 May. LA finds new tenant (T2) on same day and advises L that T2 wishes to move in on 27 June. L reluctantly accepts significant reduction (£100 per month) on advertised rent since no void period and rental yields falling. LA takes holding deposit of £300. L and LA stop marketing property.

Because of concerns as to whether T1 will actually vacate property on 26 June, L does not sign new tenancy agreement with T2 until sure T1 has left.

Today, T2 advises that cannot move into property until end July but advises that still wants property.

LA has advised that if L is willing to keep the property for T2 til end July, T2 will agree to allow L to retain holding deposit.

Question: Given that T2 had stated that he would move into property on 27 June is L not entitled to holding deposit anyway (regardless of whether he keeps property open)? I know that the answer depends on the terms of the agreement between T2 and LA, but L hasn't seen agreement and LA seems a bit clueless on this. Therefore just wondering how this sort of thing usually works.

Thanks in advance

[breaker]

I am currently trying to get a holding deposit back after a flat fell through.


What happened as we looked at a flat and we were told there was parking.
They rushed us that day and we put down a £200 deposit over the phone.
We found out that there wasn't a parking space and complained.
They offered us £100 off the referencing fees and we decided to carry on.
We signed a document to do the refrencing and proceeded.

2 weeks later over the phone they informed us that the referencing was done and added a few extra fees on:
1) First a £35 charge for the landlords admin fee
2) They requested £707 for the first months rent instead of £560 as the landlord wants the rent to start on the 1st of the month and we were going to move in on the 24th of July

At this point we decided to not move as the company were messing us around so much and we were unsure that there would not be more problems down the line.

Now they are refusing to refund the deposit saying that it is not refundable. Even though we never signed the document they have detailing the terms of the deposit as we paid over the phone.

Am I within my rights to have the money back as they hid costs and mis-represented the flat?
What can I do to claim the money back?

Sorry for the long post :)

Thanks
Ben

[David TFP]

In accepting the £100 offered presumably you accepted restitution for the garage error and essentially agreed to the rental without the garage.

The Landlord's admin fee sounds like it should be paid by the landlord and you are not liable unless you agreed to pay it.

The rent payment is not unusual moving in so late in the month. In fact it will not even cost you any more money so it is not really something to worry about.

[120]

We are moving out of our property at the end of the month, the landlord has put the place up with lots of agents.

The property has had some1 make an offer and had it accepted and holding fee placed. The landlord still keeps saying yes to letting agents show new people around.. This is quite an annoyance as we are trying 2 live,clean and pack all at the sametime.

Can he really keep doing this. ?

Regards
Wayne

[havensRus]

you don't know the terms of the holding deposit, do you?

the prospective tenant can still change their minds before contract is signed, or fail the credit check or whatever. so LL is covering all bases.

Having said that, the agents should only enter the property with your consent, so if they are being a nuisance, discuss it with the LL.

[Jaybee542]

Also, as a LL, I found out recently that with some (most?) agencies, the holding deposit represents no security at all to the LL. If the T fails to move in, it is the agency that gets to keep it. They say it covers them for any costs incurred in carrying out T references etc. My view now is that the property isn't let until I get a signed TA, one months rent in advance and the security deposit. Appreciate its a pain in the neck for you though. Also, I have read on the site that you are entitled to refuse to accept viewings if they are conducted in an inconvenient way (notwithstanding any language to the contrary in the TA). Suggest that you talk to the L and see if you can reach a compromise.

[Jaybee542]

Thanks - although the summary suggests that the Holding Fee is paid over to the L. In my case the deposit was paid to the Agent and the Agent insisted that it was not paid by way of security to me. I don't think the term "Holding Fee/Deposit" is a term of art - i.e. I don't think there is a universal meaning. Its use depends upon the terms upon which it is paid and to who.

[Lawcruncher]

If the sum is paid to the agent on his own account and not as agent for the landlord, then what is it paid for?

[Sandra18]

We still have an ongoing dispute regarding the letting agent who wrongly kept our holding fee. We have since hinted that it could make interesting reading in the local papers. The letting agent has now threatened to prosecute us if we blacken their name. Can we be prosecuted for putting our true story in the papers? Any advice much appreciated.

[jeffrey]

No. If it's true, you'd have a defence ['justification'] against libel; but:
a. you'd have to prove truth, beyond reasonable doubt rather than on balance of probabilities; and rather than
b. the claimant/plaintiff having to prove untruth.

[Sandra18]

Jeffrey,

Many thanks for your response. We initially went to the CAB and after having showed them all the email correspondence, they agreed with us that the agent had wrongly kept our holding fee. We have an email from the agent which clearly states that they will not commit the holding fee to any specific property. Our argument is: if the letting agent did not commit the holding fee to any specific property, then surely at that point in time, the money still belonged to us? They claim that they took a particular property off the market for us, yet there is absolutely no evidence of this. We did not receive any confirmation either by telephone or email that they had indeed found a particular property for us. When we were just 12 days away from flying to Cardiff, we had still not heard from the agent as to whether they would have a property available for us or not, so we decided to seek help elsewhere. We advised the agent by telephone that we had made other arrangements and they did not mention during this telephone conversation that they had found a property for us. We did not point out to them that the reason we had made other arrangements was due solely to the fact that they did not have a property available for us as we wanted to keep things as amicable as possible. They were very pleasant at this point and even said again that as they had not committed the cheque to any specific property, they would destroy it! Of course we can’t prove this telephone conversation, but we do have the email stating that the holding fee is not committed to any specific property. Would this alone be enough to prove our case?

[Jaybee542]

If the sum is paid to the agent on his own account and not as agent for the landlord, then what is it paid for?

Good question - exactly the one I put to the agents when my new tenants decided not to move in 3 days before the due date, notwithstanding they had made their offer 4 weeks previously..

Their response was that the holding deposit (£300 in that case) was paid to them for their own account and was to be applied in order to their costs in undertaking tenant references and whatever else which they would not recoup if the tenancy did not go ahead. They acknowledged that the tenant references would not have cost anything in the region of £300 (so they therefore benefited from the situation whilst I had been left completely out of pocket). I also pointed out that, when they told me that they had found new tenants, they specifically mentioned that the tenants had put down a holding deposit as a selling point for me agreeing to take the property off the market. Obviously I would not have done that if it had been made clear that I had no rights to the holding deposit should the tenants not have moved in. They just said that that was how they worked.

At the time I actually posted a question up about it on the board but got no responses. As annoying as it was, I put it down to experience and let it go.

[Bel]

Its simple: if they actually admit they didnt take the deposit against any property in particular, they have breached the Accomodation Agencies Act, as previously mentioned.
So they should refund your money, or accept the consequences.

[dominic]

Why not just report them to the police for theft/obtaining property by deception?

A police investigation should blow the wind out of their sails.

[dominic]

I have said this before, but...

subject to any term to the contrary in your agency agreement, the following are the duties an agent owes to his principal at common law:

a. To obey the lawful instructions of the principal.

b. Only to act within the limits of his authority.

c. To use reasonable diligence and care, and reasonable despatch.

d. Not to put himself into a situation where his interests will conflict with those of his principal.

e. To disclose all material facts to the principal and to refrain from divulging confidential information to third parties.

f. Not to make a secret profit or accept bribes.

g. To account to the principal for property and money of the principal which is under his control.

h. Not to delegate his authority.

Those duties highlighted in bold are apposite here. Many agents seem to forget that in return for their commission, they also owe these implied duties (unless expressly excluded in the AA) to the LL.

Depending on how you want to deal with this (the commercial relationship may overide the legal highground here) you may want to politely remind your agent of these duties, and that he/she appears to be in breach of some of them through his actions.

[Lawcruncher]

It is high time that letting agents realised what all estate agents know: commission is a fixed fee payable for providing a service however much effort you have to put into it. They should not be looking to cover their time if a tenant fails to go ahead for whatever reason. If they are entering into arrangements with prospective tenants how can a conflict of interest not arise?

[Rodent1]

A call/visit from trading standards will be very effective !

Have you got accom sorted in Cardiff now ? If not pm me !

[Sandra18]

Hello Rodent1 (love the name by the way). I have since moved back to Northamptonshire where I have family. I did wonder if the distance would affect how to deal with this agent in Wales, but apparently not. I can enquire about it from here. I did contact the Trading Standards in Wales, but they advised me to contact a local office this end and I am waiting for a response. Some people might think I should just let this go as it is only £50, but I wonder how many other innocent people may have been treated this way by this agent. Sounds like a good way to cheat money out of people. Thanks for your offer :)

[Rodent1]

As a matter of principle i would follow it up personally - at the very least be sure to cost them at least double the £50 in admin fees and time:D

[Sandra18]

Yes, I agree. I did threaten to publish the story, but then the agent threatened to prosecute, although I believe they wouldn't be able to prosecute if I have proof that they are in the wrong. I do still have the email which clearly states that they have not committed the holding fee to any specific property. So maybe that is still an option if nothing else can be done. Will keep you informed..... :)

[dominic]

Yes, I agree. I did threaten to publish the story, but then the agent threatened to prosecute, although I believe they wouldn't be able to prosecute if I have proof that they are in the wrong. I do still have the email which clearly states that they have not committed the holding fee to any specific property. So maybe that is still an option if nothing else can be done. Will keep you informed..... :)

If you state truthfully what the agent has done (in a newspaper or otherwise), you should not fear any court action threatened by the agent.

Since you have evidence in the form of emails from the agent stating that the holding dep was for no particular property, your defence to any action is even more concrete.

[jeffrey]

Yes, I agree. I did threaten to publish the story, but then the agent threatened to prosecute, although I believe they wouldn't be able to prosecute if I have proof that they are in the wrong. I do still have the email which clearly states that they have not committed the holding fee to any specific property. So maybe that is still an option if nothing else can be done. Will keep you informed.
Anyway, no-one could prosecute; libel is not a criminal offence (except where associated with a Breach of the Peace, as criminal libel).

[dominic]

Anyway, no-one could prosecute; libel is not a criminal offence (except where associated with a Breach of the Peace, as criminal libel).

I was under the impression libel was also a criminal offence (whether or not associated with breach of the peace) as well as a tort (R v Lemon).

[jeffrey]

Criminal libel [CL] mostly rests on common law rules, not statutes. There is a criminal offence, but:
a. it's much more limited than the tort; and
b. it usually necessitates breach of peace.

Halsbury's Statutes' headnote [vol. 24 (2006 reissue), p.2] makes these points in brief, in contrasting CL and the tort:
1. "Criminal proceedings should not be instituted unless the libel is calculated to cause a breach of the peace or it is in the public interest".
2. CL does not necessitate publication generally- publication to the plaintiff/claimant [P] is sufficient.
3. Truth is not a complete defence to CL. The defendant [D] also has "to show that the publication...was for the public benefit".
4. CL survives death of P if "publication is likely to provoke living persons, e.g. the family of [P]."
5. An employer is not liable for his employee's act of CL if it "was published without his authority, consent, or knowledge, or...not due to any negligence on his part".
6. Class proceedings for CL are possible "if the words were calculated to provoke the members of the class...to commit a breach of the peace".

For more stuff, refer to Halsbury's Laws of England (4th. edition reissue) paragraphs 6 and 14; and to the Libel Act 1843 sections 6 and 7.

[Sandra18]

I have just been advised that a Trading Standards Officer will be making a visit shortly to the letting agent in question. Let's hope something will come of this. Will keep you informed.

[harrowwoman]

I recently viewed a flat for my elderly father through a letting agent. It was acceptable, so I went back to the agencies' office and they said they would hold the flat upon payment of £350 (one weeks rent) until references had come through. Unfortunately the reference check failed-when I called the agency about returning the deposit they refused. I went to see them and they said they could not return the deposit, they then claimed that I had lied about my father, that he was actually a very bad tenant(where they got this info from is beyond me).They have slandered my father-an elderly gentleman who has been living with me for 10 months. I am not sure what to do?

[jeffrey]

But what (if anything) did you or your father sign at the Agents' ofice? On what basis was the holding deposit paid over?

[harrowwoman]

Nothing was signed, I paid over cash to hold the flat and got a receipt (in hindsight I should have used a credit card perhaps). The estate agent flatly refused to return the deposit, when I complained, she got her manager to call me at work to tell me that they would not be returning the deposit, understandably I got rather excited then and raised my voice, he then cut me off, £350 is no small sum to be lining their pockets.:mad:

[worried mum]

Hi - new to this but worried for my son.

He and his girlfriend were looking for a flat in an area that was between his Uni and her work; 45 miles apart. Because they were both new to the area they told the LA that they wanted something for six months so they could see how it went. If the journeying was ok, they'd probably stay; if not they would re-appraise their situation.
They filled in the application form stating a six-month AST was required and paid £140 admin fee.
LA phones girlfriend (who is on holiday with her parents in the West Country) 5 weeks prior to let to say they should come in and pay a holding deposit of £700 as a good will gesture. Girlfriend is worried so she and her Mum make way to LA (some 250 miles) and pays £700 'Holding Dep'. Gets a receipt saying it is Unallocated Funds.
Son disgruntled and phones LA to say it's too early for them to insist on deposit and asks for better receipt than 'Unallocated funds'.
Gets letter back saying it is a holding deposit.
Day of moving in and signing of AST comes. Son hires two vans, loads them and heads out from herre at 6 in morning to get to LA's by 10am.
He goes to sign AST only to find it is for 1 year. He queries this and is told he was sent a letter confirming it was 1 year and therefore he can't pull out without loosing all.
Son says he didn't receive a letter, refuses to sign and leaves.
LA refuses to hand back 'holding deposit'.
Girlfriend was due to begin work immediately after moving in and having landed on my doorstep (200 miles away) has had to tell employers she cannot take up position. Luckily they say she can begin later if they can find somewhere else to live quickly. Son does not start uni till end Sept.
They go back to area following week and find another place which they are now going for.
Original LA saying they have broken contract (although they've signed nothing), will not return copy of their original application (clearly stating they wanted a six month initial AST) and says no-one in their office remembers being told why they only wanted six-months to begin with.
Son and girlfriend can't afford to lose this money - girlfriend loses earnings and son has paid out for vans & petrol to try to move in).

Deposit waas not paid into any TDS - LA citing it was a Holding Deposit showing Good Faith!.

Any suggestions would be helpful. I wonder if they could go down the Small claims Court route but don't want to advise that if they've no chance.
Please help - Worriewd Mum

[westminster]

They filled in the application form stating a six-month AST was required and paid £140 admin fee.

Girlfriend pays £700 'Holding Dep'. Gets a receipt saying it is Unallocated Funds.

Son phones LA to say it's too early for them to insist on deposit and asks for better receipt than 'Unallocated funds'.
Gets letter back saying it is a holding deposit.

Day of moving in and signing of AST comes.
He goes to sign AST only to find it is for 1 year. He queries this and is told he was sent a letter confirming it was 1 year and therefore he can't pull out without loosing all.
Son says he didn't receive a letter, refuses to sign and leaves.
LA refuses to hand back 'holding deposit'.

Original LA saying they have broken contract (although they've signed nothing), will not return copy of their original application (clearly stating they wanted a six month initial AST) and says no-one in their office remembers being told why they only wanted six-months to begin with.

Deposit waas not paid into any TDS - LA citing it was a Holding Deposit showing Good Faith!.


In the event your son issued a claim, the onus would be on the agent to prove that they do not have to repay this money to your son. For example, agent would need to produce an agreement signed by your son saying the money was non-refundable, proof that the letter regarding the one year AST was delivered, etc.

Were there any 'terms' included on the original application form perhaps, when your son paid £140 admin fee? Did he sign it at the bottom? (I do think it's fairly likely the agent would have asked for something signed at that stage). Did girlfriend sign anything when she handed over the £700? Mind you, if there were terms in the application form, and the agent produced it, it would also show the 6 month requirement...

It's unclear what happened, or how long the gap was, between son receiving the revised receipt calling the money a holding deposit, and the day of moving in and signing the AST - surely there was some correspondence in respect of this prospective tenancy? Did your son not ask to see the agreement before moving day to check the terms were as discussed??

I also don't understand this...

Son disgruntled and phones LA to say it's too early for them to insist on deposit and asks for better receipt than 'Unallocated funds'.
Gets letter back saying it is a holding deposit.
So - it's too early to insist on a deposit (meaning no property found?) so why ask for a "better" receipt? Better than what?

I think you should ask your son if he is absolutely sure that he didn't sign anything agreeing to any terms, and what other correspondence there was about the rental property he agreed to take.

[worried mum]

Application Form was filled in and submitted together with £240 (120 pp) July 23rd. This secured property they wanted on sixmonth let.

Phone call asking for ID proof resulted in girfriends visit (with her mum) (July 27th) to offices of LA, whereupon she was asked to provide the 'Deposit'. she got money from bank in cash (£720) and gave it to LA who provided a handwritten receipt for Unallocated Funds.

Son unhappy that she had parted with so much cash; thinking that the receipt should have said 'deposit for property 'x'' so phoned LA to ask for a more detailed and professional receipt. Son asked them to confirm that it was for six months and was told yes (although LA now denies this).

Nothing ever received to suggest that TA was going to be any different from what they requested on the application form. LA says they sent letter stating 12 months; asking for proof of ID and asking for Advance Payment. Son says they never received this.

Have now had a look at the small print of the Application form where it states:
Holding Deposit/Charges: An initial holding deposit is payable by all applicants covering our administration fees: for single or multiple applicants £120 each. The appropriate monies must accompany the completed application forms subject to negotiation an agreement in principle will be made. At this point will will apply for your references and the property will be removed from our register (let subject to contract). If your application is unsuccessful we will charge you a fee proportionate to the work involved. If you withdraw your application you will forfiet your holding deposit.

Advanced Payment: A further payment on account (normally 1.25 months rent) is required in a matter of days once your application is agreed in principle. Personal of small company cheques will not be accepted unless presented at least 7 days in advance of the tenancy start date. We reserve the right to cancel applications and readvertise the proeprty where these monies are not paid by the required date. Further, where an application is withdrawn we may deduct from these advance funds an equivalent daily rent for the time the property was reserved (let subject to contract). such advance funds may be increased for additional security where necessary.

TDS: We are a full member of the TDS. Advance payments on account will be offset against the requirement to pay a tenancy deposit prioer to occupation. This deposit is protected upoin formal completion of the Tenancy Agreement wherreupon confirmation will be provided within 14 days.

My sons problem is that the AST was changed from six months (on application form) to 12 months when they came to sign the AST. The small print would suggest they are buggered but also gives the LA a way of changing things within the tenants being aware and then loosing their money.

£720 paid on 27th July for tenancy which was due to be signed on 29th August which was also moving in date.

Problems could have arisen because son & girlfriend vacated last flat in surrey on June 30th and moved to me (90 miles south). They have checked post three times over period of six weeks but have found nothing from LA.

Son also worried because on App form, guarantors details were requested (they put me down) but I have never received anything asking or vetting me as potential guarantor.

Are they doomed?

[westminster]

So your son did sign something and you now have a copy of the application form? A blank one, I assume, as you said agent refused to provide a copy?

You say "Application Form was filled in and submitted together with £240 (120 pp) July 23rd. This secured property they wanted on sixmonth let."
Is this what the application form stated - i.e. the actual property address and that it's secured on the basis of a 6 month let? Or just what your son believed at the time?

As I said, in order to show that your son signed the terms the agent would have to produce the form where he has also written 6 months (if your son doesn't have a copy). Agent also cannot prove that your son agreed to a 1 year contract instead.

Your son can prove that he hired moving vans (keep hire company paperwork!) to move in on the agreed day, which shows he fully intended to move in and not withdraw from the agreement. He arrives at the property to discover the contract is not what was agreed. Not unreasonably, he refuses to sign.

However, what I wonder is whether the 1 year agreement presented included a six month break clause? It might not have been clear in the midst of everything or your son didn't understand what it meant. I'll assume that this isn't what happened...

It's too late now, but what your son could have done is asked to speak to the landlord on moving in day, and asked whether he could amend the agreement to a six month term (I mean by simply crossing out the incorrect dates and inserting new ones). LL would most likely have agreed to the amendment.

On the facts you have presented, i.e. 6 months agreement changed to 1 year without warning, I would pursue agent for all the fees paid, including the £240 admin fee. Your son handed over the money on the basis that he was securing a six month let.

But first make sure the facts are correct. Initially you said son hadn't signed anything, now it turns out he did. There may be other things which haven't yet come to light, such as a 6 month break clause in the agreement he refused to sign. He may not have understood that this would mean he could give notice to leave at the end of six months.

If this definitely didn't happen, then the way to proceed is to send agent a letter before action, demanding the money within 14 days, and outlining the reasons. Then, if agent doesn't pay, issue a claim against the agent (the company name, not the individual), using Money Claim Online. It would be allocated to the small claims track which would keep court costs fairly low - less than £150 total if it went as far as a hearing - and these costs can be added to the claim.

Anyway, this is just my personal opinion, and I'd wait and see if others on the forum have any other thoughts or ideas.

[westminster]

Son also worried because on App form, guarantors details were requested (they put me down) but I have never received anything asking or vetting me as potential guarantor.

p.s. Absolutely nothing to worry about. Guarantors are just to guarantee unpaid rent and as there is no tenancy agreement, no rent is due. Even if your son had signed the TA, you haven't signed anything so would have no legal liability for his arrears.

[worried mum]

No six month break clause!

Son & Girlfriend viewed several flats, went home to ponder then phoned to ask LA's to email them the Application Form for property x.

They filled this in, specifying the six month requirement and specifying the address of property x. Posted the App Form off and transferred the £240 'Holding Dep' via bank.

LA's admit App form has six months (even tho' they have so far not sent a copy thru) by says Landlord only ever lets for 12 month periods).

LA's letter which son & girlfriend did not receive - but which they've now received a copy of states clearly rental terms lenght of contract etc and acknowledges receipt of Holding Dep. Goes on to ask for £740 by a few days later to show 'Good Intentions'.
LA now states that they would not have agreed to the appointment where the 740 was handed over if they had known that six months was required as 'that landlord never does six months.

Looking at the LA's website it clearly states that Holding Dep is required with Application form on a property which, when received secures property 'subject to contract'. It also clearly states that a Deposit is required on signing of Tenancy agreement. No-where is there anything about an advance payment to show good intentions.

I think they'll go for it. Many thansk for your help.

[westminster]

1.07pm - LA says they sent letter stating 12 months; asking for proof of ID and asking for Advance Payment. Son says they never received this.


6.10pm - ...the Application Form for property x. They filled this in, specifying the six month requirement and specifying the address of property x. Posted the App Form off and transferred the £240 'Holding Dep' via bank. Nothing ever received to suggest that TA was going to be any different from what they requested on the application form.....

LA's letter which son & girlfriend did not receive - but which they've now received a copy of states clearly rental terms lenght of contract etc and acknowledges receipt of Holding Dep. Goes on to ask for £740 by a few days later to show 'Good Intentions'.


The application form in itself is clear evidence that the contract your son was willing to enter into was six months for that particular property. If the agent knew this wasn't possible, agent should not have taken the money.

But does this missing letter from agent (now received) also state that the fixed term of the TA will be six months, or 12 months as you say they originally claimed? (I assume agent emailed this to your son this afternoon? - any reason given for not providing a copy of the application form?)

Tell your son to keep copies of all the paperwork he has in a safe place and print out anything sent by email now (in case of future hard-drive crash). Also keep detailed notes of phone calls with dates/what was discussed. You never know what might be needed in evidence. All letters sent from now on, keep a copy and post first class by signed-for delivery or a free certificate of postage.

From the sound of it, he has a good case to claim all the money back. But it's important to be very clear and coherent when presenting a case - the story you have told today has come in bits and pieces, and was a bit confusing initially with gaps in the story...and unnecessary information such as girlfriend having to travel X miles with her Mum - the relevant information in legal terms is that girlfriend paid £720 on such-and-such date and was given such-and-such a receipt.

Might be an idea to buy an up-to-date book on small claims procedure, there are a few on amazon.

And when your son sends the letter before action, include in it a request for a copy of the application form (and mention previous requests). Then, if agent fails to provide it, it will show they are being unreasonable and this is important for the court to know.

[Poppy35]

we always give tenants guidances notes to sign which clearly set out what the money is for and how much, if any, and under what circumstances they would get a refund.

If they have not given you anything which clearly states you will or will not get a refund I would argue the point with them until you get at least 1/2 back if not more.

[Sandra18]

Good news at last! I am pleased to tell you all that a visit from a Trading Standards Officer did the trick. It was proven that the £50 we supplied the agent with was NOT holding any specific property, therefore they have had to return this to me. It has taken almost a year to get this money back. I am glad I persevered with it and I am also very grateful for the help I have been given from people in this forum, you’ve all been great. Thank you!

[dominic]

If so inclined, your father should request a subject access request on himself under the DPA 1998. It will cost £10 (max charge the agency can impose by law) but will compel the agency to disclose all data it holds on him.

This should help you get to the bottom on why he had failed the reference check... or more likely reveal that their comments had no actual basis....

[Sandra18]

No compo unfortunately, but I am pleased to get the £50 back. Hopefully, it will teach them a lesson. They were probably hoping that I would give up and let them get away with it, but they were wrong. I have not contacted the agent since getting the money back and I am not sure whether to send her a final message or not. I will think about that... :)

[benard]

Hi all,

I viewed a house about a week ago, i told the agent of the property there and then I would like to proceed with obtaining a tenancy agreement on this said property. The manager of the letting agency asked me age, annual income, profession and said he would need to seek the approval of the landlord. The next day the manager called and said all is good and he had approval and we are through to the referencing stage... He asked me at this point if i would be able to move in within 3weeks. I said that this would be impossible as i need to give my current landlord one month notice... so we agreed the date and i paid the agency fee of £176. I then handed notice to my current landlord as i knew i would not have any problems with credit checks and reference. A few days later the manager called me again asking me to go to the agency to hand in my identification. He then asked that i go and meet the land lord at the property. I agreed as i thought it couldnt do any harm in meeting the person who i would be dealing with as soon as my contract would begin. Then at the property the landlord began threatening me and trying to put me off renting the property, he changed the deposit to 2months instead of the one month as stated in the advert. To cut a long story short he refused me as a tenant. he has given no reason why. I have also found out that it had been advertised with another agency for £50 more a month, I am now in a situation where i will be homeless if i am unable to find a property in 3weeks. Where do i stand? I know it was silly to hand in notice but seeing the agent was pressuring me to move so quick i thought there wouldnt be any problems.:confused:

thanks in advance for any advice.

[Paul_f]

All you can really do is ask (or demand) your money back from the LA and move on. They are not allowed to keep it.

[benard]

All you can really do is ask (or demand) your money back from the LA and move on. They are not allowed to keep it.

ok i get that but still doesnt seem right. i secure a house than landlord for no reason refuses me?

[mind the gap]

ok i get that but still doesnt seem right. i secure a house than landlord for no reason refuses me?

Unless you and the LL have signed a contract, I'm afraid you cannot insist he gives you a tenancy.

[benard]

Nevermind ill phone solicitor and find out. i signed contract with agency which landlord gave permission to deal with his property. therefore the way i see it landlord should be responsible for any damage caused to me. im having to rent a property i do not want because of having no where to live. most sign contract the day they move in does that mean landlord has the right to say no whenever they feel like it?? this type of twats doesnt deserve to own a property.

[dominic]

Have you asked the agent for a refund of the money (which I assume was taken as a holding deposit)?

On finding accommodation, in practice would you want to rent from an unwilling LL? Unfortunately the only practical solution here is to find another property to rent. On the bright side, you've given your notice, so your ability to move in quickly will be a bonus to other LLs.

[Moderator1]

Several largely similar questions on separate threads have been merged into this thread (hence the repetitive nature of answers).

[compforus]

Hi

I showed a prospective tenant round my flat and he filled asked to elt it. I had other enquiries but decided to go with him. I asked for the cost of the referencing and a holding deposit of £100 deductible from the first months rent.

The reference has come back with the recommendation that payment be made upfront or a get a guarantor.

I am uneasy now as not sure I want to take on a problem. (Still being out of pocket by £3k from the last tenant). He did email me to say he had a possible guarantor if needed.

My questions are these: if I refuse him on the grounds of his reference will I need to return holding deposit? If he has offered to give details of guarantor am I obliged to go through with it? If he didn't pay would I then need to chase the guarantor for the money through the courts if they didn't pay either?

[cymro123]

The OFT frown on this considerably. Neither Landlord nor Agent can withhold applicants money if tenant fails to proceed even if it states that is the case; only "reasonable expenses" can be deducted. If the applicants were to reappear and demand their money then I would be writing out a cheque. If they were to take advice from the TSO you might find that the landlord would be in some diffculty retaining the money, and the agent could be referred to the Ombudsman if they are members of a redress scheme.

Paul, can you give us some examples of what might be considered 'reasonable expenses' please? Am I right in saying that the fact that the property was taken off the market for X days is not something you could charge the prospective T for even though they dropped out before signing a Tenancy Agreement.

The reason I ask is that it is very common practice amongst the LAs in my area to charge 'non-refundable holding fees'. I know what the OFT thinks of the term 'non-refundable'. Perhaps 'holding' stands for 'holding a gun to tenant's head'.

Thanks in advance