In event of Letting agents going bust

[LewisTintin]

What happens to my deposit (effectively 1 months rent)? Do I get it back? Do I need to resign a tenenancy agreement?

I ask this, as I'm 5 months into my rental with an agency, and the agency is failing to pay me back about £200 of bills I've incurred, that the landlord should pay. As its fully maintained, they pay them to me, and claim off landlord.
I realise that as a tenant, I have good rights, and that I can remain in the property and not pay next months rent (thus recouping my deposit). However, were I to leave, and they went bust. I'm curious what would happen.
Cheers

[Geronimo]

Legally, the deposit should be held with the tenancy deposit scheme,so the good news is that it isn't in the Lettings agency's bank account. Still, if they're witholding bill money then they will probably be less than effective in requesting the deposit is returned to you.

Edited by Geronimo on Monday 8th September 14:37

[Wings]

Geronimo said:

Legally, the deposit should be held with the tenancy deposit scheme,so the good news is that it isn't in the Lettings agency's bank account.

I do not believe that is so, since there are deposit schemes where the landlord/agent only needs to register the deposit, and thereby keeps hold of the deposit.

[mouseymousey]

Wings said:

Geronimo said:

Legally, the deposit should be held with the tenancy deposit scheme,so the good news is that it isn't in the Lettings agency's bank account.

I do not believe that is so, since there are deposit schemes where the landlord/agent only needs to register the deposit, and thereby keeps hold of the deposit.

Deposits can be held by the landlord\agent but they should still be registered with an insured deposit scheme. The tenant can then get any money owed from the insurance company and the insurance company chases the landlord\agent.

LINK HERE

[Wings]

quote"Deposits can be held by the landlord\agent but they should still be registered with an insured deposit scheme. The tenant can then get any money owed from the insurance company and the insurance company chases the landlord\agent."

So in the case of the OP what deposit scheme, if any applies, has there been any notification on the deposit by the letting agent?

[g_attrill]

And if they haven't, they can sue for 3x the deposit back. Best to leave that until they are ready to leave though.

[mouseymousey]

anonymous said:

[redacted]

True. So in actual fact having the deposit registered with an insurance scheme is better for a tenant. Less chance of them just nicking it and pissing off.

[Wings]

anonymous said:

[redacted]

That will only apply if the letting agent has not registered the deposit, if the LA has, and still retains the deposit, then the tenants claim for the refund of any deposit would be met/addressed by the insurers, under the deposit scheme.

[superlightr]

Wings said:

anonymous said:

[redacted]

That will only apply if the letting agent has not registered the deposit, if the LA has, and still retains the deposit, then the tenants claim for the refund of any deposit would be met/addressed by the insurers, under the deposit scheme.

the issue is if the LA did not register the deposit, its not protected under the insurance scheeme. The tenant then has to apply to the courts for the fine of 3 x deposit to be applied to the owner, the owner can't recover the property until the deposit is registered correctly.

So if the LA has gone bust and taken your money but not registered it, you will need to apply to the courts to apply the fine for the OWNER not compliying with the Housing Act (3x deposit) the owner will then have to pay the amount of the deposit to a deposit scheeme and set it up correctly or else he cant get his property back.

The owner then sues the LA for breach of contract etc for the losses he has suffered. BUT as the LA has gone bust, they almost certainly will have been kicked out of their regulatory body and hence the owner wont get anything. You wont have any claim against the LA.

Ta da.

Edited by superlightr on Monday 8th September 17:18

[superlightr]

LewisTintin said:

and the agency is failing to pay me back about £200 of bills I've incurred, that the landlord should pay. As its fully maintained, they pay them to me, and claim off landlord.
.
Cheers

eh?

The agent wont pay you unless they have been paid by the owner or can deduct it from the rent. The LA is probably not at any liability to pay you any bills back at all, the OWNER may be but thats a different kettle of fish. You wont have any hold over the LA to pay you back bills you say you have incurred.

[LewisTintin]

superlightr said:

LewisTintin said:

and the agency is failing to pay me back about £200 of bills I've incurred, that the landlord should pay. As its fully maintained, they pay them to me, and claim off landlord.
.
Cheers

eh?

The agent wont pay you unless they have been paid by the owner or can deduct it from the rent. The LA is probably not at any liability to pay you any bills back at all, the OWNER may be but thats a different kettle of fish. You wont have any hold over the LA to pay you back bills you say you have incurred.

Its a managed property, so me and the landlord have no comm's. They do everything. And they pay me for bills such as the service charge on the property, and if something breaks. They then claim off landlord, in effect, they ask landlord first...

As for the other bits and bobs. Having asked around a bit. It seems that if they were to go bust. I could refuse payment on the property in the final month given that I've paid deposit. And from what I can gather, the landlord, has the responsbility to chase the agent. By the sounds of it, its easy for a tenant not to pay rent, and get away with it. Takes just under 3 months before you can even get kicked out, and few judges do it willingly. Mate has 17 houses he rents, and has loads of issues with tenants.