3 reasons UK tenants ask for deposit-free renting
As a UK lettings agent, you’re no doubt already aware of the growing trend for deposit free renting, where the traditional cash deposit is swapped for a membership fee or insurance. You’re probably also aware that these schemes offer landlords more protection than a standard cash deposit in return.
Landlords have been quick to grasp the advantages of an extra week’s rent cover, together with the opportunity to attract more applicants. But what do tenants think about no deposit renting? Here we look at three reasons why no deposit schemes really work for tenants.
1) Move in faster
A landlord is obliged to repay a rental deposit to the tenant within 10 days of the amount being mutually agreed, but in practice it may take weeks to reach that point (and could take much longer in the event of a formal dispute).
Even if they are not at fault, the tenant has no choice but to delay their onward move, potentially losing the new home they had planned to rent.
One of the greatest benefits of the no deposit option for tenants is that there’s no need to wait. Provided the landlord agrees to this arrangement, the tenant should be able to move in right away, without saving up for a deposit.
2) Cut the red tape
When a tenant uses a deposit replacement product, there is no cash deposit to register. That means less red tape, less admin for the landlord or agency, and a straightforward online application process for the tenant.
Tenants will still need to be referenced and credit-checked in the usual way, but removing the need to register a cash deposit helps to strip away some of the admin time involved in setting up a new tenancy and offers a simple, hassle-free way for the tenant to provide financial cover.
3) Free up essential funds
One of the greatest benefits of deposit free renting is the chance for tenants to free up money that would otherwise stay locked in a deposit protection scheme. However it’s important to ensure tenants understand that set up and admin fees are non-refundable and that these schemes do not cover a tenant for any damage they may cause to the property.
Provided the tenant understands their financial responsibilities, they stand to benefit from the flexibility that comes from unlocking their cash deposit. Whether it’s buying furniture for their new home or visiting that bucket-list holiday destination, it’s clear that no deposit renting can help tenants de-stress, move faster and enjoy life a little bit more.