Rental Deposit | What you Need to Know

Rental Deposit | What you Need to Know

Rental Deposit | What you Need to Know

Whether you are the tenant or land lord it is important to know the details of your rental contract and exactly what the rental deposit is all about. It might cause problems at the end of your rental agreement term if you have not both made it very clear to each other (and your selves) what the rental deposit covers and why you are handing it over.

What is the rental deposit for?

As a land lord you want to be sure that should anything go wrong during the tenants stay at your property you have some kind of security. This is what the rental deposit is to the land lord security against damages or unpaid rent. Should your tenant not pay his rent for a month or so you simply cover your expenses by using the additional deposit that he has provided you. The rental deposit is usually 1 and a half months rent so should your tenant not pay his rent for one and a half months you are covered and have time to negotiate his leaving the property without you falling short on the rent you expect to receive.

Also should anything be broken or damaged during the tenants time in the property (very dirty carpets that need replacing / broken doors / door frames / burnt carpets / broken windows etc etc) basically any damage that arises from lack of basic care and respect for your property or damage that is caused by accident on the tenants part will be covered for by the deposit.

As a tenant, you can rest assured that if you accidentally break or damage something in the house you are renting you don't have to have access to a vast amount of money to fix the issue as you can make use of your deposit. Do expect your land lord to hold back on the deposit and use it to repair damage to the property caused by you (not just general wear and tear) before releasing the balance of the deposit when you move out.

As a tenant you should not use your deposit as a free pass to mistreat the property. If you treat the property with respect and care and mend any accidental damages during your stay in the property, then you will be happy to receive your entire deposit back at the end of your rental agreement term.

How does the deposit work?

Before you move into the property (as the tenant) the land lord and the tenant (or the estate agent appointed by the land lord) will meet at the property and run through a check list detailing the condition of the house. The check list will detail existing issues in each room in the house as well as general wear and tear and the state of the property before you move in. The check list should contain information such as "black scuff marks on the wooden flooring in the passage" and "burn mark from an iron on the bedroom floor" then when you move out the same check list will be looked at and compared to a new check list that is created once you have vacated the property.

If there are any new damages, the cost of repair will be deducted from your deposit. The remainder of the deposit will be paid back to you.

If you have stayed in the property for a long time (as the tenant) and you have done considerable repair or improvement I suggest that you keep a record (photographs of before and after as well as invoices & statements showing costs of the improvements) so that your land lord can see the cost of improvement. Perhaps you land scaped the garden adding value for the next tenant or allowing the land lord to increase his rental income, but then you accidentally damaged the bathroom tap. The land lord can decide to still give you all of your deposit back due to the fact that you have invested your own person money into something that benefits him.

Once the tenant has vacated the property the land lord has 7 days to complete the check and pay the deposit or remainder of the deposit back to the tenant.

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