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FREE landlord softwareWhilst it protect tenants amd their deposit should the landlord go bust it does not protect a landlord who has used a letting agent to protect the tenancy deposit. The scheme called Mydeposits allows landlords and letting agents to protect the tenants deposit through an insurance based policy.
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Mydeposits is 50% owned by the NLA. Steve Hilton a spokesperson for the NLA commented:
"Under the terms of the protection scheme, there is nothing to stop a landlord keeping a tenant's deposit for the duration of the rental, as long as it is kept in a ring-fenced account and protected via the scheme," Hilton says.
"Landlords need to be aware that the scheme offers them no protection in the event the letting agent disappears with the money. It was a badly worded law and, until the lettings business is properly regulated, these problems will continue to arise."
A spokesman for the Association of Residential Letting Agents (Arla) says that had Tower been a member of Arla, the landlord could have claimed from the association's Client Money Protection Scheme. "Landlords choosing an Arla member, or an agent who's part of its sister body, the National Association of Estate Agents, would be covered in the unlikely event that the agent disappeared along with the deposit."
Although 90% of lettings agents are not affiliated to either body, Arla says its members account for about 500,000 of the 800,000 new tenancies signed each year.
Free property management software, Free tenancy agreements
"Landlords need to be aware that the scheme offers them no protection in the event the letting agent disappears with the money. It was a badly worded law and, until the lettings business is properly regulated, these problems will continue to arise."
A spokesman for the Association of Residential Letting Agents (Arla) says that had Tower been a member of Arla, the landlord could have claimed from the association's Client Money Protection Scheme. "Landlords choosing an Arla member, or an agent who's part of its sister body, the National Association of Estate Agents, would be covered in the unlikely event that the agent disappeared along with the deposit."
Although 90% of lettings agents are not affiliated to either body, Arla says its members account for about 500,000 of the 800,000 new tenancies signed each year.
Free property management software, Free tenancy agreements
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1 comment:
My comments on the Guardian website may help clarify:
"I want to make it absolutely clear that the National Landlords Association (NLA) has the utmost sympathy with all landlords who are left massively out of pocket when their letting agent goes bust.
"We receive hundreds, if not thousands, of complaints from landlords who are left having to pay their tenants' deposits back when their agent has disappeared with the cash.
"This is precisely the reason we need all letting agents to be fully regulated as soon as possible.
"Tenancy deposit protection legislation was simply not intended to protect the interests of landlords. Mydeposits purely provides a way for the tenant to get their money back in the event of a problem. It does not provide protection for landlords if their agents go bust.
"A second point: it is letting agents NOT landlords who are required by the scheme to keep their tenants' deposits in a ring-fenced account.
"Another thing: the responsibility for a tenants' deposits to be protected at the beginning of a tenancy and to be returned at the end is ALWAYS, ALWAYS, ALWAYS the landlords. Even if a landlord uses an agent, it is the landlord (according to the Housing Act) who is responsible."
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