All deposits taken by landlords for assured shorthold tenancies must be protected using a tenancy deposit protection scheme. Landlords are able to choose between two types of schemes: a custodial scheme or an insurance based scheme.
This should mean that disputes over the repayment of deposits are dealt with quickly and cheaply thereby reducing the need to go to court.
The government has awarded contracts to three companies to run the tenancy deposit schemes. The three schemes are:
- The Tenancy Deposit Protection Service. This is a custodial scheme open to all landlords and letting agents.
- Tenancy Deposit Solutions. This is an insurance based scheme aimed primarily at landlords.
- The Tenancy Deposit Scheme. This is an insurance based scheme aimed primarily at letting agents.
Landlords that fail to protect a deposit under one of the schemes will be breaking the law. They will be unable to gain possession of the property using notice-only grounds for possession.
Tenants will be able to seek redress through the courts. Where a court is satisfied that a landlord has failed to comply with the deposit protection requirements, it will order the landlord to meet these requirements and also to pay compensation to the tenant.
If you would like further information about tenancy deposit protection schemes, please contact the scheme administrators as detailed above.
Alternatively you can contact the Housing Advice Centre on 01223 457918 or email housing.advice@cambridge.gov.uk