LL insisting we use zero deposit scheme.

[LemonSorbetCone]

We are trying to get a rental property. The agent is telling us that the LL will only accept us if we go with their zero deposit scheme.
im a bit confused about this. We’ve offered a larger deposit as we didn’t realise this is now no longer possible.

the way I understand it we’ll be paying a monthly ‘fee’ and then at the end may be liable for any damages.

essentially we’re being forced into a scheme we don’t want and we are a bit worried there may be some implication we’ve missed.

does anyone have any advice on this please?

I’d be wary as well. Most deposit schemes have ( traditionally) found in favour of the tenant or have awarded the landlord a much lower sum for example 2/7 of replacement cost given its five years old already whereas landlord wants a shiny new replacement for free.

I don’t think you can force them to use a paid deposit scheme though. So you need to decide whether to accept their terms or find another agent who hasn’t signed up for this scheme.

We can’t find anything in the school catchment atm that meets our requirements.
might have to pay the holding deposit and risk losing that if another place comes up that doesnt use the weird scheme.
it feels like I’m being sold something that I don’t want or need.

I’ve not heard of this but i am an accidental landlord. I had a look. Firstly, The zero dep scheme cannot be offered as a sole choice. Essentially the ZDS is to purchase insurance against loss from the LL up to the value of 6 weeks rent. They cannot if I understand correctly charge you for losses at the end of the term.

yes I’ve told them that we are concerned they are pushing us into this and got told we either want the house or not.
the info I’ve been sent about the scheme indicates we pay the monthly fee and at the end any damages the adjudicator awards are also due.
I’ve checked with the agent now and she has confirmed this.
im not sure if we should just leave it.

That sounds rubbish. I suppose you they have you over a barrel.

how much is the fee and can you purchase additional insurance to insure you against any loss?

I had another look. The one I looked at is 1 week plus 59.99 upfront and then an annual fee of 17.50.

landlords can only claim up to 6 weeks rent for damage at check out. What is your record of getting deposits back?
it is FCA accredited. But that is little reassurance

They aren’t supposed to force you into using this scheme. That said they are allowed to choose another tenant based who is happy to go along with zero deposit scheme.

Have to say I hadn't heard of them, but googling I only managed to find one full contract on this site

https://www.stirlingackroyd.com/wp-content/uploads/2023/11/No-Deposit-Arrangement.pdf

And it includes a clause saying you need to pay £264 if you want to dispute the landlords damages valuation at checkout!!!!!

You need to check how much it will cost to dispute the landlords damages claim.

The fee is £85 but they have reduced the rent by £85 so we’re paying nothing.
we haven’t rented in decades so no references available. Maybe this is what is making them nervous.

i cannot see if this scheme is FCA accredited. It’s just the agents. The wording is awful and very unclear.

thank you for your help! I appreciate it.

Thank you that’s a good point. The T&Cs don’t say anything about a fee for the adjudicator. It says that we both have to agree to use the adjudicator but not what happens if we don’t agree.
it also says the agent gets a minimum £14 referral fee. No clarity on what they are actually getting.

I’m a landlord and my Agent uses the no deposit scheme. It’s there to help tenants who don’t have the deposit up front. It’s never been an issue for any of my tenants and if there’s been charges at the end of the tenancy they come from the insurance cover. If it’s the right property for you just go with it!

I wouldn’t worry too much about lack of refs if you have proof of income and stability and also I just get a feel for a tenant and red flags.

Shelter is really good for renting info and renter rights. https://england.shelter.org.uk/housing_advice/tenancy_deposits/zero_deposit_companies

from what you have said regarding the referral fee they must be using an accredited company which has to be FCA regulated. Can you find out wha it is?