Four Deposit Replacement Myths Busted For Agents
Myth 1: Deposit replacement schemes aren’t popular enough to make business sense.
Truth: The deposit replacement market is booming! And no wonder. Schemes like our Zero Deposit Guarantee mean tenants don’t have to pay a huge chunk of their savings upfront for their deposit. Meanwhile, landlords get enhanced protection and letting agents get a great package to help them stand out from competitors. All very attractive propositions. We’ve successfully partnered with over 2,700* letting agents across the UK and that number’s growing all the time!
Myth 2: With no deposit ‘invested’ in the property, they’re more likely to damage it.
Truth: Some people worry deposit-free tenants will leave the property in poor condition because they think the deposit replacement provider will foot the bill. In reality, tenants are just as liable for damage and unpaid rent as they would be with a traditional cash deposit. We make sure they’re clear about their responsibility when they buy their Zero Deposit Guarantee. In fact, the landlords we work with have greater protection because we give six weeks of cover instead of the typical five weeks you’d get with a cash deposit.
Myth 3: If I sign up for a deposit replacement scheme, I’m entering into a mis-selling scandal.
Truth: If you’re worried that a deposit replacement scheme could lead to financial claims further down the line, you don’t need to be. But remember, as with all business decisions: do your research! Not all providers are created equal, so make sure you look into their reputations. At Zero Deposit, we’re regulated by the FCA, which means we’re legally obliged to protect the rights of our tenants and landlords, and to treat them fairly. This authorisation gives our letting agents the essential protection they need to recommend us to their landlords. It’s just one reason why 96% of tenants polled said they’d select a Zero Deposit agent above the rest**. No wonder Zero Deposit is the most liked Deposit Replacement Provider in the UK***.
Myth 4: There will be a higher number of small claims, and it’ll be slower getting them resolved.
Truth: As market leaders covering more than 18,000 Zero Deposit tenancies* and counting, we can confidently say this simply isn’t the case. Our average claim value (capped by the maximum liability of 6 weeks) is £789*, with only 13% where the total value claimed is under £200*. We’ve resolved 44% of claims without the need for TDS adjudication and paid 50% of Rent Only Claims within 21 days of the claim being raised*. Moreover, 79% of claims submitted to us this year have been paid within 2 working days of receiving bank details*.
We hope this helps make the truth about deposit replacement schemes easier. Still confused? Drop a line to our experts at support@zerodeposit.com – we’ll be happy to help clear up your questions.