Deposit question

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  • Deposit question

    We rent out shared houses where we pay the bills. Due to increasing gas/elec prices we have set a threshhold (About £85/month) for the gas and electricity.

    The tenants are signing an agreement that if the usage goes over this level they contribute towards costs.

    A new LL we are managing for wants to tell the tenants that it will be taken out of the deposit. Are there any issues with this (aside from the obvious - damage costing more than the deposit can cover) and with the agreement as a whole or does it need a major re-think.

    Help appreciated!
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  • #2
    Is the agreement seperate from the AST.
    Disclaimer:I have over 30 years experience in housing(both social and private) as an EHO and Building Surveyor.I am also a certified expert witness having spent the last 15years working in housing litigation.The advice I give is from experience in working for various Local Authorities and how the law is interpretated.Housing Law is a minefield and is continually being amended if in any doubt you should consult a solicitor or someone of equal legal standing.

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    • #3
      Originally posted by Wickerman
      Yes, it is separate from the AST.

      (I tried saying "yes" but the message was too short to be accepted!)
      The £85 a month threshold is fair don't think there's any arguement there. In the original AST no doubt it states that you as the landlord are responsible for the gas and electric bills and the tenants who have signed have made this a legally binding agreement.Was the threshold figure inserted into the AST or is the wording what ive already stated ie Landlord responsible for bills.I think some of these factors must be taken into consideration as it may be possible that by getting your tenants to sign another agreement may be seen as "unfair".As for using the desposit again your tenants may see this as "unfair" and may lead to problems later on.How much longer have the AST'S got to run?
      Disclaimer:I have over 30 years experience in housing(both social and private) as an EHO and Building Surveyor.I am also a certified expert witness having spent the last 15years working in housing litigation.The advice I give is from experience in working for various Local Authorities and how the law is interpretated.Housing Law is a minefield and is continually being amended if in any doubt you should consult a solicitor or someone of equal legal standing.

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      • #4
        The handling of the deposit is governed by the AST and the landlord cannot make deductions from this, without the tenant's agreement unless specifically permitted to by a clause in this AST. The only option, IMHO, if the tenant refuses to assist the landlord with the increases in utility prices is to serve a section 21. The tenant can then be removed (hopefully) at the end of the fixed term of their AST. Of course said tenant can always sign a new AST with appropriate clauses inserted.

        P.P.
        Any information given in this post is based on my personal experience as a landlord, what I have learned from this and other boards and elsewhere. It is not to be relied on. Definitive advice is only available from a Solicitor or other appropriately qualified person.

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        • #5
          Originally posted by P.Pilcher View Post
          The handling of the deposit is governed by the AST and the landlord cannot make deductions from this, without the tenant's agreement unless specifically permitted to by a clause in this AST. The only option, IMHO, if the tenant refuses to assist the landlord with the increases in utility prices is to serve a section 21. The tenant can then be removed (hopefully) at the end of the fixed term of their AST. Of course said tenant can always sign a new AST with appropriate clauses inserted.

          P.P.
          Agree with you there P.P.Wait for the AST to run out then insert the clauses or issue a S21 NOTICE or at the end of the AST issue a S13 to raise the rent to cover the extra charges.
          Disclaimer:I have over 30 years experience in housing(both social and private) as an EHO and Building Surveyor.I am also a certified expert witness having spent the last 15years working in housing litigation.The advice I give is from experience in working for various Local Authorities and how the law is interpretated.Housing Law is a minefield and is continually being amended if in any doubt you should consult a solicitor or someone of equal legal standing.

          Comment


          • #6
            Originally posted by Wickerman View Post
            We rent out shared houses where we pay the bills. Due to increasing gas/elec prices we have set a threshhold (About £85/month) for the gas and electricity.

            The tenants are signing an agreement that if the usage goes over this level they contribute towards costs.

            A new LL we are managing for wants to tell the tenants that it will be taken out of the deposit. Are there any issues with this (aside from the obvious - damage costing more than the deposit can cover) and with the agreement as a whole or does it need a major re-think.

            Help appreciated!
            Is there any particular reason why the tenants don't have responsibility for the bills? I would have thought they'd be much keener to be careful with how much they use if they have to pay for it directly!
            If possible you could negotiate new agreements at the end of their current fixed terms where they are responsible for the bills and not you, and adjust the rent by whatever figure you negotiate to take into account the change of responsibility.
            Alternatively get coin or card meters installed and let them fight it out between themselves!!!
            (Just a suggestion, not 'legal advice' as I'm not a legal bod.)

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