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Letting agent deducting insurance from deposit

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572 views 1 replies latest reply: 07 March 2016

Hi there, just a quick query, my letting agent is trying to force me into another 12 month contract, and by doing so wants to re-register my deposit but deduct the cost of the insurance from the total. I thought the deposit was a fixed pot available to the homeowner should any damage be done to the property? Is removing costs even legal? In a few years after repeatedly ‘tapping the pot” the owner will have nothing to reimburse himself if I were to cause damage.

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Hi Ian

The landlord should cover the cost of protecting the deposit – I don’t know how much they’re trying to charge you but it’s usually pretty cheap (£20ish). Contact the deposit protection scheme holding your deposit (it will be one of three) and check their costs to make sure the agent isn’t scamming you. It’s also worth finding the literature on the website that says the cost should be paid by the landlord – for example this is the DPS info.

This cost cannot be taken from the deposit itself – as you say the deposit is only to cover damage that you may cause, or unpaid rent – and nothing else. It’s worth noting that the money is yours until you consent to a deduction so unless you consent then the landlord/agent has no right to any of it. This agent sounds very dodgy – especially given what you’ve said about forcing you into a new tenancy. They can’t force you into anything, agents have limited power – they can only do what the landlord tells them to and they are accountable to any professional bodies they are a member of (ARLA, Property Ombudsman, for example) if they step out of line. So, you can threaten to contact the landlord direct (details should be on tenancy) and/or make a complaint to whichever body they are a member of if they continue being unreasonable.


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