A survey with over 4,000 private renters in England by housing charity Shelter has revealed that one in five do not know if their deposit has been protected and almost one in ten know that their deposit definitely has not been.
Overall, nearly one in three renters appears to be entirely unaware of tenancy deposit protection schemes, a year since tenancy deposit protection law was improved to ensure greater protection for renters. Shelter is encouraging renters to check that their landlord has put their deposit in one of the government-backed schemes within 30 days of receiving it, as is now required by law.
Shelter’s research also discovered that the rising cost of deposits – now on average £992 – means that seven per cent of renters were forced to take out credit last year to pay for their deposit, including credit cards and payday loans.
"We campaigned for this change in the law to stop renters from losing money in unfair deposit deductions," said Campbell Robb, chief executive at Shelter, “ so it’s extremely worrying that so many are still unaware of their tenancy deposit rights. We know that most landlords do the right thing but unfortunately some are still unaware of their responsibilities to protect the deposits that are given to them in good faith."
Housing Minister Mark Prisk added: “Tenancy Deposit schemes offer vital protection for both tenants and landlords, giving them financial peace of mind and offering neutral help to resolve disputes.
“In March alone, 2.6 million deposits were protected by Government backed schemes, and over the last six years, more than 7 million deposits have been protected. But there’s always more to do to ensure that people know, and exercise their rights, and I hope that with Shelter’s help, even more tenants will know how to ensure their hard earned cash is safe.”
As well as protecting the deposit from being unfairly withheld, tenancy deposit protection schemes also act as independent mediators if renters think unfair deductions have been taken from it when a tenancy ends.
Landlords who fail to place their tenants’ deposit in one of the government authorised schemes within 30 days of receiving it or can be taken to court. They could face a penalty of up to three times the value of the deposit, which is then awarded to the tenant.