Holding Deposit through letting agent – my agent lost us a prospective tenant through false claims about the property and is now refusing to repay the holding deposit he took.
A holding deposit through the letting agent is intended to reserve a letting, and the landlord/agent does this by taking the property off the market, though new enquiries should still be recorded.
If the letting goes through, the holding deposit should be credited to the main deposit or to rent.
If the letting does not go ahead, through the fault of the prospective tenant, then it’s usual for the deposit to be retained in compensation for lost time – this belongs to the landlord. In this respect it’s important not to take too much as a holding deposit – one week’s rent is usually about right and should compensate fairly if retained.
If the letting does not go ahead through the fault of the landlord / agent then the deposit should be refunded.
In any case there should be a written Holding Deposit Agreement / Receipt which makes it very clear what will happen to the deposit in these eventualities – when the deposit should be returned or retained.
Agents need to follow a strict code of practice (Property Ombudsman Letting Code -see below) and if they are members of a professional association (Landlords should always deal with agents that are) they will also have their own code.
©LandlordZONE All Rights Reserved – never rely totally on these standard answers which apply primarily to England & Wales. Before taking action or not, always do your own research and/or seek professional advice with the full facts of the case and all documents to hand.
Holding Deposit Agreement:https://www.landlordzone.co.uk/agreements.htm