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  • Buy-to-Let

    Just read a post about refunding deposits

    Am I reading this correctly that if you have an existing tenant and they renew the tenancy at the end of the initial term you have to refund the deposit you hold?

    Is this correct?

    Is this still right if it is in the DPS?

    I have a long term tenant who paid 8 weeks deposit as she has a dog. Whole deposit is in DPS but not sure how they can make us retrospectively change all of our tenancies! I normally have rolling contracts ....

    ANy advice?

    Excerpt:

    Will we need to refund existing deposits that are longer than five weeks?

    You won’t be expected to retrospectively give back one, two or three weeks' rent, depending on the length of the deposit you’ve taken. However, if the tenancy renews, anything in excess of five weeks will become a prohibited payment and you would have to refund it. For example if you’ve taken a six-week deposit and the tenancy renews on 1st January 2020, you will have to give back that extra week.

    https://blog.goodlord.co/questions-and-a...dium=email

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    I think the post you have put up is pretty clear and explains your example perfectly.

    If you've got 8 weeks held in DPS - then when the tenancy renews you need to give back the 3 weeks deposit as it is over the 5 week limit.

    The example you quote says exactly this.

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    I just didn't realise it applied to all existing tenancies too. I am amazed my letting agents haven't sent anything about this on the ones they manage too. I really believe it was just all new tenancies... I guess I was asking is the info correct....


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    It is all newly signed tenancy agreements. This includes where you sign a new tenancy agreement with an existing tenant (e.g. at the end of their fixed term).

    If you let the current tenancy lapse into a periodic tenancy at the end of the fixed term then there is no signing of a new tenancy agreement and you do not need to refund the 3 weeks deposit. I would assume this is your situation as you talk about a rolling contract.

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    HI yes I don't send out new contracts every 6 or 12 months I just leave them with the original contract which says after the period continues on month notice basis - this is a long term tenant who is planning 10 years +. If I have to I have no issue paying her back.

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