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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

AIBU to keep hold of tenants' rental deposits?

35 replies

BycullahRoad · 01/06/2019 18:22

I'm a long term landlord, with a three bedroom flat quite a distance away from where I am now, but which will hopefully be my retirement home one day. I've been renting it out as a flat share with three tenants, each having one bedroom each. Current group of three tenants (two men, one lady) had been there for just over two years. Their original tenancies have expired so that now they are on periodic tenancies.

Two of the tenants have become a couple and have just had a baby together. Third tenant does not appreciate new baby in the flat and has given notice to leave. Remaining couple came to me and said that now that they have a baby, they want improvements doing to the flat.

The lady is lovely but to be honest her partner has always been a bit off with me. I had a meeting with them in the flat over Easter, noticed that they had done some pretty dodgy DIY, and they had taken up the carpet and replaced with laminate flooring that is against the terms of the lease. Having said that the flat was fundamentally clean and tidy.

I looked at what they wanted doing, had a good think, replied that I was happy to redecorate up to a maximum of £1,000, happy to repair their breakages, but that they would need to take a tenancy for the whole flat, i.e. pay for all three bedrooms, not just pay for two out of three bedrooms, with the new tenancy being prepared and managed by a local estate agent. I checked on Rightmove and found a similar flat, reduced the rent by £100 per month and then wrote to them offering them the flat at that reduced rent and instructed a local agent to draw up the paperwork. However, the new rent would have been about 40% higher than their old rent as the third bedroom was ensuite and was rented out for more, and also I had not put up the rent for many years.

Move forward a month, the local agent has said that he has not been able to arrange a meeting with them, and they have also missed their monthly rent payment (at the old rent). Now they have contacted me to say that they think the new rent is unfair, that they are moving out, they are not paying any more rent and they want their deposits back in full. My reply was that if they wanted their deposits back, they had to at least keep on paying rent (at the old rent) until they departed. Since then they have not replied to any messages.

Would be interested in views as to whether I am being fair, or not?

OP posts:
RaptorWhiskers · 01/06/2019 18:24

How can you keep hold of their deposit if it’s in a tenancy scheme? And if it isn’t in a scheme you’ve broken the law by not putting it in one.

Original poster
BycullahRoad · 01/06/2019 18:25

Sorry I forgot to mention that the deposit is with the TDS.

OP posts:
CodenameVillanelle · 01/06/2019 18:26

You can only keep their deposit for damages I believe - unpaid rent must be recouped through the court. I struggle to understand why you didn't serve them notice when you saw they had damaged the property and reduced the rent instead! Are you that hard up for tenants?

Lanaa · 01/06/2019 18:27

You're not being unfair at all, but be warned Mumsnet's resident landlord haters will come along and say that you should let them stay in your property for free.

Give them notice now as they're unlikely to pay any rent at all. Issue a section 21 ASAP. Good luck.

CodenameVillanelle · 01/06/2019 18:28

Actually I think I'm wrong about that, you can deduct unpaid rent. But unless they leave willingly, you'll have to take them to court to evict and that will take much longer and cost more than their deposit covers. Not to mention the damage they caused.

nrpmum · 01/06/2019 18:28

More than as far as I'm concerned. I'd be making moves to evict just in case

BackOnceAgainWithABurnerEmail · 01/06/2019 18:29

If you can withhold for that reason then do. If not, the TDS will release it. You could however charge them for the damage - dodgy DIY etc.

Shame. You were doing them a favour.

RaptorWhiskers · 01/06/2019 18:31

Under the TDS you can request to keep the deposit if you’ve suffered a financial loss. So you could keep money to cover any unpaid rent and to put right any damage they’ve caused with their dodgy DIY. But you’d have to come to an agreement with the tenants - in the event of a disagreement about how much they’re getting back the TDS will hang onto the deposit until it’s resolved.

ichifanny · 01/06/2019 18:31

You can’t keep the deposit for unpaid rent but I believe you can to pay for reversing changes they made to your property without permission .

Original poster
BycullahRoad · 01/06/2019 18:37

Thanks everyone, yes I thought I was doing them a favour. They said they wanted to stay long term and would look after the property. At this stage in life I do want security of tenants rather than constant change. Fortunately I did serve S21s with the letter I sent offering them a new tenancy. I just feel disappointed and let down.

OP posts:
DuckWillow · 01/06/2019 18:45
Sad

Such a shame they have let you down like this. It might be that the rent was more than they had budgeted for but even so as a tenant you have to pay rent until you leave, I would never have dreamed of mucking about with the rent as a tenant.

My guess is they are putting it aside for a new tenancy but surely the fact they’ve left with rent arrears won’t look good. I showed my rent account when I went to social housing to prove I was a reliable payer. I seem to recall they asked to see it as part of references.

Original poster
BycullahRoad · 01/06/2019 18:50

You're right, I can't give them a good reference now. They had even said that they would be getting a family member in to help share the cost and to assist with baby sitting when the lady went back to work, and I had agreed to that in writing in my letter.

OP posts:
Witchtower · 01/06/2019 18:54

Seems fair. Keep the deposit to replace the carpet they ripped up.

RandomMess · 01/06/2019 18:54

Presumably you can use the deposit to put carpet back in that they shouldn't have removed?

BrightYellowDaffodil · 01/06/2019 18:55

I’m the first to bash crap landlords but it sounds like you’ve been more than fair, and they’ve massively taken the piss.

I would be contacting TDS and asking what you can/can’t deduct from the deposit. If you can take off unpaid rent then I absolutely bloody would. And I’d be instigating proceedings to evict them too.

NailsNeedDoing · 01/06/2019 18:58

Of course you keep the deposit in this situation.

barrelohflaughs · 01/06/2019 19:10

Wait until they move out and then raise a dispute with the TDS. They will award in your favour and you’ll get to keep the deposit for rent arrears.

barrelohflaughs · 01/06/2019 19:11

Or, tell the tenants that You’re keeping the deposit to cover rent arrears and let them dispute it with the TDS. They will need to prove that they don’t owe the money. Is the amount of rent owed based on the old rent or the new higher rent?

regmover · 01/06/2019 19:25

Bloody hell, why do people come on threads like this when they don't know what they are talking about? Of course you can keep the deposit to recoup unpaid rent. Obviously it won't be based on the higher rent because you haven't set up a rental agreement on that basis, so it's based on your current agreement.
They've also done damage, which hopefully you can prove with the photos you took during inventory when they went in. It's easy to find out what you can and can't withold for, look on the TDS website or give them a ring. You don't need to discuss any of this with the tenants really, just work through the process with TDS when they apply to have the deposit released. If they even do, they might be just planning to pay no more rent and expecting to lose it.
I'd be thankful that they seem to be leaving under their own steam and no need to give them notice and then probably evict.

DaisiesAreOurSilver · 01/06/2019 19:30

Keep enough of the deposit as you need to replace/repair their efforts.

JeremyCorbynsCoat · 01/06/2019 19:38

A lot of crap advice here. You can absolutely retain the deposit for rent arrears. If the tenants don't agree you can use the deposit protection companies ADR service. If you can prove the arrears the deposit will be awarded to you.

lyralalala · 01/06/2019 19:44

Not unreasonable to put a deduction for missed rent to TDS. Also put the deduction in for the value of the carpet (bear in mind you'll only get what the carpet was worth rather than the cost of a new one).

Make sure you follow through everything on their notice and keep yourself absolutely right in case you end up in court.

Did your agent issue the S21? Did they keep copies? Make sure it was absolutely correct in case it holds up the process.

Livelovebehappy · 01/06/2019 20:17

You’ve been absolutely more than fair. Just be grateful that they have said they are leaving as they sound like they would be nightmare tenants.

Original poster
BycullahRoad · 05/06/2019 06:48

Four days have passed and there has been no further contact. No rent has been received and there has been no reply to two further texts asking them to contact me about their rent. Clearly this is not going well. Does anyone have any suggestions as to how resolve this situation?

OP posts: