Which deposit protection scheme to use

If a tenant on an assured shorthold tenancy pays a deposit, it must be protected in a government-approved scheme. The court can order a landlord to repay up to 3X the amount of the original deposit. The DPS offers two deposit protection services, one of them free. You will also be asked to answer some security questions, so the DPS can validate your identity at a later date.

The Custodial deposit protection service is free to use and you can protect as many deposits as you like. This scheme is the most popular. Simply create an account, add the details of the tenancy, and pay in the deposit. The DPS will then prepare the prescribed information for you to pass along to your tenants. A free Custodial account with the DPS gives you access to free training, free dispute resolution, and the latest DPS Rent Index , so you can track tenant trends and make more informed decisions about your buy to let business.

Once you have created a Custodial account, you can add a property to your account. This can be done even if the property has not yet been let to a tenant; it means you have everything set up and ready to go as soon as the tenant pays you their deposit. The Insured scheme is more applicable to letting agents and larger corporate landlords with many properties in their portfolio. The service is easy to use and is a much better solution than pursuing a claim through the courts.

Landlords submit their evidence in support of a claim, for example, photos of damage and estimates to put it right. Tenants can then provide their own evidence to support their position. All evidence is sent to an independent adjudicator. The final decision is then sent to the landlord and their tenant. If you use the Custodial deposit protection service, you and the tenant have 14 days to submit your evidence once you start the adjudication process.

The adjudicator has 28 days to reach a decision. A decision is final and binding, but you are free to come to a mutually agreeable solution before the adjudicator has ruled.

MyDeposits has been protecting deposits since MyDeposits is run by Hamilton Fraser, a buy to let insurance expert. It is the only deposit protection scheme endorsed by the National Landlords Association.

MyDeposits also has a dedicated MyDeposits Wales page. Any type of landlord can use MyDeposits, including professional landlords with large portfolios. There is a bulk deposit upload feature, which allows larger landlords to protect multiple deposits at once. This helps to reduce property admin. This streamlined system is especially helpful when you are managing student properties and a large number of tenants are moving in and out at once.

MyDeposits has a business development team for larger landlords. There is also face-to-face training and support available.

MyDeposits can be integrated with landlord software for automatic deposit protection. As well as the peace of mind of having such a professional organisation to act as an intermediary in any end of tenancy dispute, the TDS web site provides a wealth of information, case studies and legal precedents to guide landlords through the tricky decision-making process. Keep up the good work. Fantastic service. I have had occasion to use the deductions template twice, since the excellent course I attended with you in Birmingham, and both times successfully managed to avoid dispute.

I also used the guides to manage landlords expectations, thank you! As I previously had a letting agent for my property I was really unsure about how to take over management, especially around the deposit. Their customer service is excellent, providing friendly and timely advice. No question is too small and it feels like a very personal experience where they know your case well.

Thank you TDS! We have recently moved to TDS from another scheme and the process has been smooth and Debbie and the staff have been brilliant with the transition period. The system is easy to use and if we ever need assistance our requests are dealt with promptly. Very happy with the service received so far. A great company to associate with, understanding of our business and the ever changing market. A valuable affiliation for us, that we clearly benefit from.

If one party objects to using the DRS, the situation cannot be adjudicated and the matter will have to go to court unless the two parties can come to an agreement themselves. If either party wishes to take the matter to court the deposit protection scheme will advise on the appropriate course of action. Remember that - as well as our regular home insurance quotes service - you can use Gocompare. Landlords may also want to consider some of our more specialist products, such as unoccupied home insurance, holiday home insurance or business insurance.

GoCompare uses cookies. By using the website you agree with our use of cookies. Home Landlord insurance Tenancy deposit protection schemes. Tenancy deposit protection schemes If you're a landlord or a tenant, it's important for you to know how the tenant's deposit should be handled.

What is a tenancy deposit protection scheme? What schemes are available? The landlord can choose which scheme to use. Within these three approved schemes, there are two types of scheme: custodial and insurance. Custodial TDP schemes With a custodial deposit scheme, the tenant's deposit is held in a bank account which cannot be accessed by the landlord or the tenant by the scheme operator.

Insurance TDP schemes Here, the landlord or their agent holds on to the tenant's deposit but pays a fee to insure it against being kept unfairly at the end of the tenancy. What will happen when a new tenancy starts?