Tenancy Deposit Schemes: What Are They and Why You Should Care as a Tenant

Tenants | Thu 13 Feb 20

Moving – and the jargon that so often comes with the process – can be a minefield. From Assured Shorthold Tenancies (ASTs) to default fees and arrears, there are plenty of words and phrases to get your head around if you’re about to take the leap and move into your first rented property.

Conveniently, On the Market runs through some of the letting jargon you might need to know – just head here. But what about the much-publicised replacement deposit schemes?

If you’re ready to move house, it’s a no-brainer to sign up for a deposit replacement scheme, like our Zero Deposit™ Guarantee.

Smoother Renting for Everyone

But what exactly is it? It’s essentially an initiative set up to ensure renting a property is much smoother for would-be tenants.

We all know renting is an expensive experience – and we can so often feel the pinch before we even unlock the door to our new home. For tenants, though, a Zero Deposit Guarantee means they need only pay a week’s rent as a non-refundable fee (as opposed to the standard five weeks). Thankfully, it’s something many landlords are extremely open to using – and there are plenty of reasons why. Here are just a few of them…

Making Moving Cheaper

As Movebubble points out, you could have to stump up a hefty amount of cash before you agree to move into a property. It focuses on a property that costs £300 a week as an example, suggesting that if you agree to rent it with a five-week security deposit, you may have to put up a whopping £1,500 before you get the keys. Then, you’ve got the first month’s rent on top of that. It can all get very pricey, very quickly.

While you do receive the security deposit when you leave, you may have a long wait until that’s the case. Now ‘dead money’, the cash you put aside is tied up in the rental property until you move on. And then you may have to wait a few weeks before the landlord or lettings company carries out the necessary checks on the property before you get it back.

It Makes Sense for Landlords

The Zero Deposit Guarantee, though, makes renting a property an absolute doddle. No longer will you need to dip into your savings to cover your deposit; instead, you can move in sooner and spend the money you’ve saved on the things you love.

You may be wondering why landlords should get on board with deposit replacement schemes.

The truth is, they make sense for them, too.

Our Zero Deposit Guarantee protects landlords for six weeks’ worth of rent. In an instance where there’s a dispute at the end of the tenancy, the Tenancy Deposit Scheme (TDS) adjudicates the disputed claim, just like a regular deposit. It really is win-win.

Keen to hear more? Just head here if you’re a tenant, here if you’re a landlord and here if you’re an agent.