Lack of awareness remains over tenancy deposit protection schemes

A year since the new law was introduced, almost 1 in 3 renters are still unaware of tenancy deposit protection schemes.

A survey, conducted with over 4,000 private renters in England, also found that one in five (20%) don’t know if their deposit has been protected. Worryingly, almost one in ten (9%) know that their deposit definitely has not been protected.

Shelter is highlighting the issue one year on since the tenancy deposit protection law was improved to ensure greater protection for renters. The housing charity is encouraging renters to check that their landlord has put their deposit in one of the Government-backed schemes within 30 days of receiving it – as is now required by law.

Shelter’s research also discovered that the rising cost of deposits now– on average £992 – means that 7% of renters were forced to take out credit last year to pay for their deposit, including credit cards and payday loans. This puts renters at even greater risk if they are unable to get their deposit back.

Campbell Robb, chief executive at Shelter, said: “We campaigned for this change in the law to stop renters from losing money in unfair deposit deductions, so it’s extremely worrying that so many are still unaware of their tenancy deposit rights.

“We know that most landlords do the right thing but unfortunately some are still unaware of their responsibilities to protect the deposits that are given to them in good faith.

“At Shelter we hear from thousands of renters who have huge chunks deducted from their deposit for no good reason, or who have to wait months to get their money back. To help prevent this from happening to more of England’s nine million renters, visit Shelter online to share your deposit stories and help us highlight this important issue.”

Housing Minister Mark Prisk said: “Tenancy Deposit schemes offer vital protection for both tenants and landlords, giving them financial peace of mind and offering neutral help to resolve disputes.

“In March alone, 2.6 million deposits were protected by Government backed schemes, and over the last six years, more than 7 million deposits have been protected.  But there’s always more to do to ensure that people know, and exercise their rights, and I hope that with Shelter’s help, even more tenants will know how to ensure their hard earned cash is safe.”

As well as protecting the deposit from being unfairly withheld, tenancy deposit protection schemes also act as independent mediators – benefiting both landlords and renters – if renters think unfair deductions have been taken from it when a tenancy ends.

Landlords who fail to place their tenants’ deposit in one of the Government authorised schemes within 30 days of receiving it or can be taken to court. They could face a penalty of one to three times the value of the deposit, which is then awarded to the tenant.

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One thought on “Lack of awareness remains over tenancy deposit protection schemes

  1. Laurence Dillamore

    “Housing Minister Mark Prisk said: “Tenancy Deposit schemes offer vital protection for both tenants and landlords, giving them financial peace of mind and offering neutral help to resolve disputes”.

    Comments such as that are misleading and precisely why there is so much landlord confusion as to who is protected from what with TDP. There is absolutely no “financial peace of mind” for the landlord in circumstances where an agent uses one of the two ‘insured’ TDP schemes that accept unaffiliated (no Client Money Protection backup) letting agents and who then misappropriates a deposit. The landlord is always ultimately responsible.

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