UK Landlord Forum / Life

A few weeks ago I agreed to let my property to someone, who when they had initally looked round said that they would take on the let from the 1st of the month. This was one of the factors in picking this particular person (some of the other interested people couldnt move in until later on). I went on and did all the checks, everything fine and in the meantime I double checked they were still ok with a moving in date of the 1st, which they were. However I then got a call from them saying could they move the date back a couple of weeks. I agreed, thought  I wasnt going to fall out over a couple of weeks, but now they have asked to put it back another week. So I'm losing out on three weeks rent.

Is there anything I can do about this? short of saying I've changed my mind and don't want to let it to them anymore (which would be counterproductive as then I'd have to look for a new tenant). what if they put back the moving date again? they are keen to pay the deposit and say they still want to rent the place.

thought I'd done my homework and had covered myself for all eventualities, but I didnt foresee this!

Is there a good reason for them not moving in?

I assume they are not already under contract, but this sort of behaviour would make me nervous.  Just because your tenant checks are all OK it does not mean they will make good tenant, it just means that you have not uncovered anything bad.

If they have an astonishingly good reason for not keeping their word, you may want to give them 1 more week, but warn them you will then start looking elsewhere after 1 week.  If they dont seem to have a good reason, I would kick them into the long grass immediately.

Hi Zoe,

You may have done a lot of the right things, but you made one fatal mistake. You stopped your search for tenants BEFORE the tenant signed the contracts and paid the deposit and first month's rent. Tenants delaying and flaking out is unbelievably common, that's why it's important to keep on looking until it's all confirmed. Don't just take your prospective tenant's word for it, because it ultimately means nothing.

To be honest, I would feel uncomfortable letting to these people. They're clearly unreliable. I would personally start looking for new tenants, simply because you're already on edge and feeling anxious about their actions, and that's never a good start/sign.

very many thanks for the replies    this landlord game is a steep learning curve!

I am in a bit of a turmoil now, I can't see why they would originally say they just had to give a month's notice on their current place, and now the story has changed to that they had to give two month's notice. Surely they would already know that? on the other hand they want to pay the deposit now. Do you think they are keen to pay the deposit now so they can't lose the place by messing me around?

For some misguided reason I assumed that they would need to sign the tenancy agreement on the move-in day, with the money (deposit and first month's rent) arriving just before this. So really instead I should be getting the contract signed and the money paid as soon as they have agreed to take on the place, rather than waiting for the move-in day?

Luckily I have a list of other potential tenants so I could find someone else easily, would you just tell this person to forget it if they are going to mess about with the moving date...or would you give them another chance if I can get them to agree a date and sign the tenancy agreement now?

sorry for all the questions.....pass me those L plates 

It's hard to say what their intentions are. But what I can tell you is that by law, they only have to give one month's notice (assuming they pay rent on a monthly basis, which they most likely do). So I don't buy the whole "2 months" notice junk, because that's not enforceable.

Contracts are signed and deposits are often paid BEFORE the move in date to avoid the situation you're in now. Also, that's why in most tenancy agreements there is a "start date" and a general contract "date". The latter being the date the contracts are signed and the former being the date the tenancy starts.

Hmm it's up to you really. I would personally find new tenants- 3 weeks delay is pretty long in my opinion. Their reasons might be genuinely innocent, but it's still careless and disrespectful. But if you want to go ahead, just ensure they sign contracts and pay the deposit asap, like with in the next few days.

thanks. a bit of an odd excuse then!

If I get them to pay the deposit now, how does that work with submitting it to the DPS? again I had assumed that securing the deposit would be something to do after the tenant had moved in. or do I not need to secure it until after they have moved in?

The way I did this was to meet with the tenant two days before the tenancy commenced.

They had paid the first month's rent into my bank that day and had cash on hand for the deposit.

We then signed contracts, and stapled to the contract was the DPS Prescribed Information, and the DPS reference all printed out. I had prefilled the Prescribed Information so all we had to do was sign everything.

A few days later I deposited the 'deposit' with the DPS, I had 30 days from commencement to do this.

the problem is, now the move-in day has been put back, we are a few weeks off it. so if I get them to sign the tenancy and pay the deposit now, there is quite a large gap of time before they can move in. can I keep hold of the deposit until the tenancy starts...e.g. does the clock start ticking for the 30 days once the tenant moves in?

Pretty sure the law says "beginning with the date on which it is received."

And depositprotection.com says

"The agent/landlord must ensure that the Prescribed Information is correctly completed and served on the tenant(s) within 30 days of the agent/landlord receiving the deposit. "

https://www.depositprotection.com/help/browse/custodial/agent-landlord/prescribed-information

thanks.... and just to check (as I'm now getting totally paranoid about the whole thing) the prescribed information is the four-page sheet called "prescribed information relating to tenancy deposits" which you need to complete and give a copy of to the tenant complete with the tenants guide document and the terms and conditions booklet (better buy more green printer ink!) ?

it sounds like at this point a deposit is a bit of a waste of time.....at the end of the day if they mess me about and pull out I would have to give it all back anyway so it's pretty useless surely!

thanks again for your help 

Hi
Why not consider a 'holding deposit'?
I know some people are wary of the term deposit and its legal ramifications, but basically I say to my tenants once the checks are all done, I'll hold the property for 1 month max, if they pay the 'holding deposit' (which I sent at 1 month mortgage). If they don't move in they loose the deposit (and my costs are mostly covered), and if they do, it becomes part of their normal deposit (I'm slightly out of pocket but that's the way the cookie crumbles).
It's worked for me so far and might make them a bit more reluctant to mess you around.
Good luck
C.

I like the idea of a holding deposit, I do think that the whole area is messy though.

It is right that a tenant should have some confidence that a deposit is protected, but I dont really think the current legislation takes account of the fact that you may want a deposit up front before the tenancy starts.

For example, I would like to know what the law would make of an early deposit, (you can call it holding or anything else it is still a deposit) which is taken more than 30 days before the tenancy commences.  Does a tenancy agreement have to be in place for DPS type scheme have an relevance?

The whole thing is a mess.

I take a £200 Referencing Fee, which I give them back if they move in on the date they first said. This comes in handy for them as it goes straight into the money they give me for the deposit... handy.

Obviously this wouldn't cover the 3 weeks you have missed out on.

Although I wouldn't put them off now, just insist a bit that that is it, if they don't pay rent now, they will loose it.

I dont know about you but moving is a pain, and you have " well this weekend is Jons Stag, following weekend is Pauls do, and we got tickets for the theatre, and the weekend after that Mums coming down to go Bude shopping, so lets move on the Umteenth of Toptober."

A holding deposit is entirely different to, and can be completely separate from, a security deposit.

One is used to ensure something is not let to someone else... is would be non-refundable by design, the other is to provide compensation to a Landlord for any damage caused during a tenancy... if there is no damage at all then it is all refundable. Stating "whether you call it holding or anything else it is still a deposit" is incorrect.

If everything goes as planned, then the holding deposit amount could be used against the first month of rent, or - even - to go onto the security deposit. The Tenant doesn't lose-out unless they renege on the agreement - an agreement, let's face it, that they will have pushed for in the first place because they don't want to lose the place.

So, a holding deposit can work. However, if a holding deposit is, say, £500 or £1,000, and the Tenant doesn't follow-through on the agreement (for whatever reason) - you can easily see a situation arising where they ask for it back, regardless! It's just too much money to throw away and they'll fight for it. Causing further ructions and confusion. That is why I don't generally work with holding deposits. Once I have and it was for £100... the prospective Tenant didn't want me to undertake any more viewings. We figured £100 was a small enough amount for the prospective Tenant to lose, if they didn't stick to the plan, without kicking-off and it would compensate me for any inconvenience. Carter's way of  "1 month mortgage" I can see working without too much friction as well, especially if it's interest only.

Anyway, the main reason I wanted to jump in on this thread... I read that the prospective Tenants here originally thought they needed to give 1 months notice at their current place, but have now found out that they need to give 2 months notice. They might be completely genuine. Not everyone is expert in statutory rights... we all know that a tenancy that has become periodic requires Tenants to give 1 full months notice... the Tenants might have thought that too. However, there are many, many ASTs out there where the Landlord or an Agency has written in "2 months" (the equivalent, really, of what the Landlord must give)... but this is not legal and cannot be enforced. However, we know these ASTs exist and the Tenants may have tried to give their 1 months notice but have been rebuffed and then incorrectly told that they must adhere to their current AST.

I'm not saying it helps the OP, but you can easily see how this situation could arise. Basically, if so, the prospective Tenants are being bluffed by their current Landlord. I've read this thread through and it appears as though the OP is a little bit in the dark - may I suggest simply asking the prospective Tenants why this has happened? It might all end up making sense. If it doesn't you can take another path towards getting different Tenants... just like you fear they can mess you around, you can just choose to not let to them if you are feeling nervous.

Onto another topic raised here... as for timing... I would only sign the AST (all of you) and hand over the keys on the day of move-in after all funds (advance rent and deposit) have cleared in your account - anything else is going to be dangerous. I meet Tenants at the property... I validate all funds are already in my account, we go through a check-in, we sign the AST (that has been provided to them in draft form at least a week earlier), we sign the deposit stuff, I hand over keys... I depart.

So... if you haven't... I would be asking the prospective Tenants what's going on, as I think there's a chance for too much supposition. If the explanation makes sense, then you're happy (hopefully)... but if it all sounds a bit off, you have a good idea of how to take it forward. It's OK to ask prospective Tenants questions like this without being too challenging or nosey... you are about to give them 'control' of one of your most valuable assets.

Quote from: Hippogriff on October 26, 2014, 09:22:13 AM
A holding deposit is entirely different to, and can be completely separate from, a security deposit.

One is used to ensure something is not let to someone else... is would be non-refundable by design, the other is to provide compensation to a Landlord for any damage caused during a tenancy... if there is no damage at all then it is all refundable. Stating "whether you call it holding or anything else it is still a deposit" is incorrect.

Fair point Hippogriff.

My point was really one of paranoia that the legal system can seem disproportionally to favour the tenant over deposits.  So, if any deposit is taken early on and it is not formally recorded as a 'security' deposit, I have concerns that a court could decide that this was a security deposit and not a holding deposit. Extending that point, if then the period between taking the deposit and the commencement of the tenancy was sufficiently long, this could impact the ability for a valid deposit proptection to be taken out.

So, if it is clear that a holding deposit is as such, and this can be evidenced then fine. However if it isn't I would not want to be the one testing this in court.

Hi Zoe, I am very sorry that you are having problems with these potential tenants. So far they have caused you to lose money. Tenants can be thin on the ground in some places so I understand if you want to hold onto an offer. But if they are not thin on the ground and you can still advertise the property and find a more suitable tenant that does what they say - well, from reading your situation, I would! The question you have to ask yourself is, is this behaviour acceptable and do you want to continue to deal with people like this? Good luck!

Many thanks for all the replies. The tenant has now paid me the deposit, but we are just over three weeks off moving in day. Is there any way I can make it clear that this deposit is a holding deposit, rather than a security deposit? Can I write a letter/send an email confirming this (which could then be used as evidence if there was a problem).

Or is this risky as if the money was viewed as a security deposit, we would be very close to the 30 day limit by then?

p.s I'm glad I found this forum, what fab place for advice (and might stop me being eaten alive so to speak by tenants who know more than I do!)

I think this was my original point about ambiguity.

You must ask yourself what are the expectations of the tenant.

Should something completely unexpected happen, and they have to pull out, would they expect their deposit back.

If yes, they see this as a security deposit
if no, they see this as a holding deposit

The difference matters, and if it is not already documented and accepted by both parties, then you may need to consider whether you need to do this.

Are you clear what the purpose of the deposit is?  Is the tenant ?

Thanks. I will have to check with the tenant. Originally when I said I would need a deposit it was meant just as a security deposit, as they were due to move in within the next week.  Obviously that has now changed and it would be good to have it as a holding deposit, I am hoping that because they were keen to pay it to me, that is what they want it to be. If I can get it in writing from them that they are happy for it to be a holding deposit, then hopefully all will be well, and then when they move in it can become the security deposit and I can then submit it to the DPS.

Quote from: zoeb on October 26, 2014, 10:57:38 AMIs there any way I can make it clear that this deposit is a holding deposit, rather than a security deposit?

You can't just decide this on your own... the two parties would agree this beforehand and, yes, you'd cover everything in writing.

I suspect - but you might tell me I'm wrong - that you have taken a deposit for placing into a deposit protection scheme to protect you against damage caused to the property by the Tenants.

If you wanted a holding deposit, you needed to have asked for it and got agreement for it before you took money. I don't think you'll get far taking money then, afterwards, informing someone that this is considered a holding deposit and if they pull out, then you keep it. Unless, of course, this was their thinking all along too, then it's fine.

However, you sound like you need to get a better handle on things... no offence intended as you are learning.  So, take a deep breath and sort out your plan... what you need to happen and by when, what will be the consequences if it doesn't happen and - my big favourite - communicate with your Tenants.

Have you yet managed to find out why they slipped from 1 month to 2 months? Do they have a good explanation that you can jive with?

Let's remember why you started this thread... you were concerned about them slipping their tenancy start date and your confidence in them had taken a hit. That particular issue doesn't yet seem to have been resolved, to me... but we have talked about a fair number of other, related, things.

Quote from: zoeb on October 26, 2014, 02:05:21 PMIf I can get it in writing from them that they are happy for it to be a holding deposit, then hopefully all will be well, and then when they move in it can become the security deposit and I can then submit it to the DPS.

This would appear to suit your purposes perfectly. You must be clear on what them pulling-out is, though... not taking the tenancy at all is obviously pulling-out... delaying a bit longer... well, you decide... obviously you don't want to get off on the wrong foot.

Thank you hippogriff, I think I am sorted now! The tenant has had to give two month's notice as a condition of their existing tenancy- they werent aware of this (hadnt read tenancy agreement/or forgot?), had contacted their agent to give a month's notice and then were told that they would have to give longer. So a genuine reason. In hindsight I should have talked to them first before flying into a panic but on the other hand I have learnt loads from this post and I'm glad I did post on here, as I have a better idea what to do in the future now! as you say I am very much a learner and I'm sure despite reading as much as I can I will continue to make mistakes for some time yet (I possibly should have stuck to the day job!)
they are happy for the deposit to be a holding deposit, so I will confirm this in writing. as you say if it comes down to it I don't know how much 'hold' I would have on it but I guess it's start and showing willing. 
thanks again. Zoe

Good, I hope.

Landlord / Tenant relationships can all too easily become adversarial... when they really shouldn't - it should be a beautiful relationship! In time you will certainly get better at sniffing-out who is yanking your chain and who is genuine... let's hope these Tenants work out for you. I would always urge communication.

Mistakes will be made... we all make them.

thanks 

"tenant keeps putting back moving in date"

Your thread title is inaccurate - should read "Random person off street who I don't know keeps putting back moving in date"  they are not your tenants.

You've changed.