Transferring a deposit

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  • Mrs Dingle
    started a topic Transferring a deposit

    Transferring a deposit

    Is it possible to transfer a deposit between two properties that are both registered with the dps, the same tenant and the same landlord.. Or do I have to go through the procedure of refunding and re-securing the deposit with the dps. The new website for the dps is very vague and unhelpful.

  • Mrs Dingle
    replied
    The tenant has received the letter. Just pointing out the ridiculous system the dps has. The tenant has logged on and agreed to the payment to me and said that the website says 5 days for repayment.That was 6 days ago and the dps website still says waiting for tenant response! So my next step now will be to cancel the claim and re-apply to return it to the tenant. Unless at this stage it will go to arbitration. What a joke. There is no dispute. The tenant hasn't got a bank account registered with them and so this will be slow as well. This process started in early April!! The tenant isnt worried. As far as their concerned their bond is somewhere and they have little interest in sorting it out.

    In hindsight. Which is a wonderful thing!. I should have insisted on a deposit to be paid for the new property. Which would have encouraged the tenant to pursue the re-payment of the old property deposit.
    Last edited by Mrs Dingle; 03-06-2018, 20:18 PM. Reason: addition

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  • mariner
    replied
    T could set up, with Royal Mail, a re-direct for all correspondence addressed to her.

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  • Mrs Dingle
    replied
    Thank-you for all your interesting views on this scenario. The deposit has been in the possesion of the dps since first protected and remains in their possesion until released to tenant or landlord. When applying for it I stated what had been agreed with the tenant about payment to the landlord so it could be secured against the second flat. I feel that the tenant has more control over it anyway as its the landlord to prove rent arrears or damage and not the other way round. So I am not in possesion of a deposit for the second flat yet. It remains " payable" not "paid". I could have asked for the deposit to be returned to the tenant instead to be then given to me to protect again. Not sure either way leads to me being penalized for not protecting it.

    Its a real shame that it couldn't have been transferred from one property to another. Making for a smooth continuous transaction with no money moving anywhere. Thats where the dps scheme seems inadequate .Dps still insisting it will only send post to the tenants old address so the practical events are now totally reliant on the new tenant at the old flat taking round post to the old tenants new address. How very secure!

    I understand now you can have multiple deposits at the same address now. Just as well!!

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  • MdeB
    replied
    Originally posted by Mrs Dingle View Post
    I will soon need to place a deposit on number 11. Which I expect the dps won't allow.
    DPS allows multiple deposits against one property, otherwise you could not re-let until a disputed deposit was sorted.

    I have had 2 deposits against a property.

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  • jpkeates
    replied
    Originally posted by MdeB View Post
    Yes she was.
    The money for the deposit is held by the DPS (as deposit for first property); that money is agreed to be returned to the LL to form the deposit for the second property.
    Well not exactly.

    The money was tenancy 1's tenant's money.
    If the proposed DPS process is followed, the money is claimed by the landlord and, with the tenant's consent, awarded/given to the landlord.
    It's then transferred to the landlord's bank account.
    The money is, at this point, the landlord's - although possibly with some promised use.

    Then the landlord gives it back to the tenant as a deposit for tenancy 2.

    It's impossible to tell accurately when this happens.
    Is the landlord holding the money they've been awarded on trust?
    And if so, when does that liability actually arise (when it's agreed or when it transacts)?
    Or does the change of owner actuallly happen?

    At this point, there doesn't even seem to be a deposit at all, as there's nothing in the tenancy agreement for the latest tenancy.

    My guess is that this is all a bit academic, in real life, eventually it will get sorted out and the compliance/non-compliance won't ever be an issue.
    But from a legal point of view it's a shambles.

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  • mariner
    replied
    MdeB, There is no evidence of such an arrangement. The DPS are obliged to reimburse the nominated person, but protection requires LL to provide PI. Deposit is not deemed to be ''protected' once released from Scheme.
    Mrs Dingle failed to consider the legit fix of temp providing 2nd Deposit from own resources until reimbursed.
    S/he is now at risk of 2nd Property T claiming 1-3x deposit for Deposit non-protection

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  • MdeB
    replied
    Originally posted by jpkeates View Post

    The landlord was never going to "receive" this deposit in the sense of having money handed over.
    Yes she was.
    The money for the deposit is held by the DPS (as deposit for first property); that money is agreed to be returned to the LL to form the deposit for the second property.

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  • Mrs Dingle
    replied
    The deposit will remain on the old property until the tenant responds. Which I'm going to help him with when the letter arrives at the empty property. Interesting that the dps know all the details but insist on sending the letter to a vacant property because it's procedure. The new lease doesn't state at all that a deposit has been given and therefore no receipt for it because it hasn't been paid yet. I would be suprised if I could be prosecuted for being in possession of a deposit that I should have protected when clearly no money changed hands. Two entirely seperate issues I think. Meanwhile I'm trying to protect another deposit recently received but the dps process won't accept a dual tenancy where there is only one phone number and no e-mail addresses. I have to provide a contact for each person and it won't accept the same phone number. I am finding the dps so inflexible and hard to deal with. I've always thought the dps was really easy until the last four months. Thanks for your input.

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  • jpkeates
    replied
    I agree it's unacceptable.
    I also use the DPS and haven't had an issue - but to be honest, I haven't done much recently other than protect and release a couple of deposits.

    However, you are not correct that the tenant's deposit is "technically" protected.
    The requirement is to protect the deposit in line with the protecting scheme's requirements, which is to allocate the deposit to a specific property and tenancy.

    The tenancy associated with the deposit currently has ended, and that deposit money is in the normal position, it is in the process of being returned to the tenant. Just like thousands of other deposits for tenancies that have ended.

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  • Mrs Dingle
    replied
    The deposit in question has been with the dps for over 5 years and continues to be secured. Albeit on the wrong property. So the deposit paid by my tenant on the original tenancy has been continuously protected. The tenant still has power over it as I presume the government wanted. So the tenants deposit technically is still protected. If there was a way to transfer it without returning it to either the tenant or myself. I would gladly use that route. The dps has been changing a lot of its processes and it's becoming increasingly difficult for tenants to understand it or comply with logging in or providing information. I've been protecting all my deposits with the dps since 2007 and only recently had problems. I will be considering changing how I manage the deposits. It's over two months since I started dealing with this one. Which is totally unacceptable.

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  • jpkeates
    replied
    The DPS advice is wrong.

    There is no possible defence against not protecting a deposit other than proving that you did.
    It's possible that the facts of the case might encourage a judge to keep the penalty at the lower end of the range - but that's still the value of the deposit as a minimum.
    It's like a speeding charge - you either were speeding or not, there's no other defence to the charge.

    Any s21 notice you serve would be invalid unless you return the deposit first.

    Obviously, in this case, the tenant may not make a claim at all, so the risk is probably theoretical.
    However, don't take any notice of "advice" from the DPS - any more than you should take tax advice from HMRC (for example).

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  • Mrs Dingle
    replied
    The dps has no vehicle for transferring a deposit in this case. It can transfer between landlords and agents. Just spoken to the dps by phone. The original letter sent to the tenant is now useless because the dps has recently altered their processes. So cancelled claim and restarted claim. This will go to the previous flat which is now empty. I will collect the letter and carry it round to the tenant and help him to phone up and sort it. I did ask about penanltys possible for the new flat. The dps said that in the case of a tenant claiming for not securing the deposit within 30 days. I would have to prove that the tenant failed to respond to the dps and the fault would be his. This is easily proved because I have the support of the dps records in that respect. Not a situation that is likely to happen as the tenant is very happy and simply doesn't do Internet and won't wait on the phone. The dps has made a lot of changes in the last few months. Waiting on the phone for up to 45 mins is still commonplace which is a shame.

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  • jpkeates
    replied
    The DPS has a process for transferring a deposit without returning it.

    The deadline for compliance doesn't have any flexibility.

    If your tenant doesn't have internet access there's almost no chance of getting the deposit back in a timely manner - it takes weeks and weeks for a paper-based process.

    You need to protect the deposit and serve the PI by Friday.
    It doesn't matter how many issues you have with that or how difficult the DPS or the tenant are; that's a hard deadline.

    I'm sorry if I'm coming across as unsympathetic, but I don't think you have any choice if you want to stay on the right side of the regulations.
    It's not about fairness or being right. You either comply or you don't.

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  • Mrs Dingle
    replied
    The "admin " problem is with the dps. I have claimed the deposit as instructed to do and agreed to by the tenant. Which should return the money into my possession. Which I can then place with the dps on the new tenancy. The tenant is willing and wants to help but can't get through to the dps by phone and doesn't use the Internet. It takes 4/5 days for the dps to respond to any enquiry by me and so the problem drags on. There is no assignment of the deposit. The last tenancy was ended and an entirely new tenancy agreement signed and started on the new flat.

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