UK Landlord Forum / Life

Hello!

Which deposit scheme to use? what are the differences between them?
* my deposits

*DPS deposit protection.com

*tds.gb.com

It looks that they are the same!

Many thanks,

What do you want from a scheme? Do you want to pay a fee? Do you want to keep the money?

Keep the money

Keep the money from the tenants

Pay for the insured scheme then.

Indeed. Your decision has just been made by recognising your own desires (with some help from strangers on the Internet). Nice.

Hi there,

It really depends what you want from your scheme.

Is it your only property? If yes, you are better off with a custodial scheme (DPS) where you transfer the money to the scheme and the service is free. If you have a large portfolio you need to make some maths and figure out if the premium you need to pay to the scheme is less than the interests you can earn by keeping it in your bank account.

Some of the schemes also want you to have a client money insurance if you are not part of a landlords association.

Here more information about deposit schemes: http://bit.ly/LF1_tenancy_deposit

But do a good assessment of what is best for you and do your own research as well. You have 30 days to protect the deposit from the day the tenants paid you.

Lais from RentSquare
Rent made simple
www.rentsquare.io

The amount of deposit is only important, not the size of portfolio.

Quote from: Hippogriff on March 11, 2016, 09:16:11 PM
The amount of deposit is only important, not the size of portfolio.

True, but on the deposit for the average rent price...

Did you intend to finish that sentence?

Sorry, you're right Hippogriff, I wasn't clear.

What I meant was that assuming this is the only property the interests you can gain might not be hugely different from the cost of using an insured scheme. Of course this has many variants:

1. How much is the deposit
2. How long is the tenancy
3. What is the percentage of interest you can gain
4. Are you part of a landlord association
5. if yes, what is the scheme they give you discount on and how much will cost to insure the deposit
6. If you're not, does the scheme asks you to have a client money insurance in place?
7. how many properties do you rent out and what is the total of deposits you hold

When you work out how much are the costs of 4, 5 and 6, work out how much could you gain of the deposit + % of bank interests over the length of the tenancy.
Then you can make an informed decision.

On my experience if you have more than one property then insured schemes are worth as you can offset some of the costs (i.e. Association membership costs or joining the scheme costs). - off course the membership gives you access to other services, so put that on the balance too.

When just one property it might just work out a couple of pounds more really. If you consider a normal interest rate and an average value of 1 month deposit. Account also for the time of putting all of these in place, might just be simpler to go for a custodial scheme which is free.

Hope this is clearer now.

Lais from RentSquare
rent made simple
www.rentsquare.io

Hi.
I'm coming into this late as I have just started investigating TDS (again).  I am in the tds.gb.com scheme.  I am moving to an AST agreement, removing the Estate Agent from the equation.  As near as I can tell, I have to protect the deposit again because a new agreement is being signed (same rent, though). 

Should I wait until the new agreement is signed before renewing the existing TDS scheme?

Also, I believe I need to get the standing order mandate renewed.  Do I submit this to the bank somehow or does the tenant do so?  The Estate Agent did all this the last time so I'm trying to learn quickly.

Noddy questions, but better to ask than to get it wrong.

Thanks for any info.

A receiver of monies does not control or have input into a Standing Order - that is purely the realm of the originator of the funds. You might be thinking of Direct Debit?

However, you have to accept this comment (as you even said it yourself), if you're getting mixed-up at this level... what hope do you have? Sometimes you just have to accept... you may need an Agent. Good luck!

BTW - it is always better to ask, I'm with you, but I'm still shaking my head a bit.

HI.
Thanks for the information.  I'm already managing the property without any involvement of the estate agent and I think I have good tenants, so I'm going to give it a shot on my own. 

Going back through the documents I found the Standing Order Mandate which had been signed by the tenant (which prompted my query).  Given that the mandate had fixed dates on it, I feel a new mandate should reflect new dates.  At least I will have something on file.

"Good judgement comes from experience, and a lot of that comes from bad judgement.".  It popped into my head when I read the last line of your reply,     Thanks again!

I can add that I've never had any kind of document detailing a Tenant's Standing Order... and I've had many Tenants over the years. This is something that is left entirely up to them. I am not 100% sure if it implies something about the standard of Tenants I've engaged with, but they've just all had Internet banking and have all been able to set up their own Standing Order within a few minutes.

Quote from: belgarion on March 16, 2016, 11:25:07 AM
Do I submit this to the bank somehow or does the tenant do so? 

Standing orders have to be set up by your tenants as this is an "instruction" that the tenant gives to their bank to send that money out. You can ask them to set it up again with the correct dates cancelling the first order, and send you proof of this (which I am assuming is the document you have from the original tenancy).

Direct Debit is the one that you can have a little bit more control as it is basically the permission to take money out someone else's account - but also costs you monthly.

Standing Order usually works pretty well. Although tenants have the possibility of cancelling it without giving you notice, usually there are fees involved for tenants if the standing order didn't go through due to insufficient funds, which means that people usually take this seriously.

If you never had problems with this tenants is quite reassuring that standing order would do.

Good luck.

Lais from RentSquare
www.rentsquare.io