Rent default, using Deposit Funds

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    Rent default, using Deposit Funds

    (sorry its a little long!)

    Hi guys,

    Wondered if you could give me some advice. Will give you a brief summary of my situation. Any help would be much appreciated.

    - I have been letting out my property for the past 5 years to same tenant
    - no major problems experienced, paying on time (standing order),all inspections have been OK etc.
    - Last month: no rent received
    - contacted tenant, they checked with bank - apparently she was being investigated for some form of dishonesty with regards to tax credits claims and they stopped her payments
    - She agreed to pay half of the rent immediately, and the other half when her issues sorted.
    - Subsequently, contacted me to say that she owes the tax credit people money as they have been overpaying her for years.
    - cannot afford to stay at the property any more and gave in her 30 day termination notice (to end 24 Nov 2012)
    - asked me to take the deposit money (DPS) as rent for the remainder of her stay (which miraculously was more or less exactly what she owed)
    - she has stated that she would pay all the required expenses related to damages/cleaning of the property
    - she says she has absolutely no money at the moment

    Although I have agreed to this in principle, I have major concerns. Taking the DPS would leave me with no means for negotiating any property damage. I then asked her that I'd like to do an inspection this coming week - which she refused, saying this should be done at the end once she's moved out. She also re-iterated that she would have no issues paying any amounts owed for damages/cleaning, and that I have nothing to worry about.

    Can anyone help with this situation?

    Do I just take the deposit money and hope that the property won't be trashed?

    Or is it safer to hold back and not touch the DPS money until I have inspected the property on her vacating? I spoke to a friend in the legal profession and he said that suing her for rent arrears is easier that trying to get her to pay for damages which she may later deny.

    Not quite sure which way to play this one. Any help would be much appreciated. Many thanks in advance.


    There are some who argue, though I have never quite understood the logic of it, that you should never take anything out of the deposit for rent until the tenancy has ended. In this case all the facts surely point to taking what you can as early as you can. If you get the tenant's agreement to use the deposit for rent then the money is yours. If you mess about arguing over what should be deducted for damages etc and demand the rent outstanding it could drag on. As to suing, you cannot get blood out of a stone. I think it is unwise to make any decision on the basis that the tenant may trash the property.


      After a five year tenancy there will be significant wear and tear. Even if the T has damaged something you will have to factor in five years' wear and tear, and in many cases you would only be able to claim a portion of the replacement cost.

      For example, if the living room carpet is badly stained, beyond cleaning, you cannot claim the full replacement cost, only a portion depending on the expected life-span of the carpet - if it's a cheap carpet, expected to last only five years before requiring replacement due to fair wear and tear, then you wouldn't be entitled to anything, because you'd have had to replace it anyway.

      Why do you think she might trash the place when she's been reliable for five years?


        Thanks guys.

        You make some good points. I guess I should just take the DPS money like the T has suggested and hope for the best. It's not that I don trust the T or think they're going to trash the place, but you just never know!!

        That's also a good point about wear and tear. I will bear that in mind. I have taken pictures from the start of the tenancy and over the years I can see an obvious change in the state of cleanliness.

        Would there be any advantage in waiting until I do a check-out inspection of the property and then decide what to do? If all looks fine, then take DPS money. If any major issues, then leave DPS, sue for rental arrears, and claim back damages/repairs via DPS??



          I would do as Lawcruncher advises and take the deposit money now to set against rent, when T is willing to release it. Worry about the rest later.


            As above, take any money offered now.
            Allow tenants to protect their own deposits. I want free money when they do it wrong


              Agree with everyone above, after 5 years little point in pursuing matter further. Do remember getting money from DPS quickly requires cooperation from tenant.


                I think the tenant's much more likely to leave the place ok if you demonstrate support...


                  Great! Thanks guys. It's useful to get an objective view on things. I think I'll do what is suggested and take the DPS while I can! I guess the rest can be dealt with as it comes, and hopefully there won't be anything major...

                  I appreciate all your input!

                  Cheers. :-)


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