Agency keeping a deposit if the landlord doesn’t like our references?

Posted by 19flash92@reddit | AskUK | View on Reddit | 29 comments

How common is this? I’ve put an offer on a flat that was accepted and they are asking for a holding deposit before checking references etc? It states this in the email: “Should you change your mind prior to entering into the Tenancy, or the Landlord is forced to withdraw as a result of references which are not forthcoming or which could not reasonably be considered as satisfactory, you will lose your holding deposit to cover our costs incurred.” Surely they could just make up an excuse about the references and keep the cash?

Reply to Post

29 Comments

[-]

DrWizdom@reddit

i had this happen to me twice, never was able to get the money back from the agency (in London). threatened all sorts of legal action but they didn't care. they made a mistake in the referencing but ultimately blamed me for it, dragged so long in the end they just resort to 'computer said no' responses so i gave up. can't believe they can get away with doing that.

[-]

4gnieshk4@reddit

Glad to hear it is regulated and illegal. Would be a great scam option: accept holding deposit, say you're "not satisfied worth the references", hold the deposit, repeat the process.

[-]

Deathlehem4@reddit

As someone who uses to work at an estate agents that’s exactly what was going on. They could have 1 property on the market and take 5 non refundable deposits for it. Nowadays they put the fees on the landlords.

[-]

Good_Loaf@reddit

My olfactory senses are detecting a large amount of bullshit here. The security deposit is there for the landlord to recover missed rent payments or damages, they don’t get to just keep it for a laugh

[-]

EricTheBread@reddit

This isn't about the security deposit, it's about a holding deposit prior to renting. Still not allowed to keep it in most instances, though.

[-]

trillospin@reddit

They're referencing a holding deposit, not a security deposit.

[-]

lazy-lambda@reddit

This makes no sense and I've never seen such a term before while renting. Smells like gaping bull arse.

[-]

Horrorbmoviepunk@reddit

Have you signed anything to say they can? If not sue.

[-]

Deathlehem4@reddit

They done away with these fees years ago. Legally you’re entitled to your deposit back.

[-]

V65Pilot@reddit

Looks like I need to make a phone call. I never got my holding deposit back because I couldn't pass the background check due to only being here a short time. They never actually ran the check, because I called the company that did them and queried some of the questions. At which point I realized I would never be approved, and told them so. In effect, the paperwork to run the check was never completed.

[-]

ActivatedBiscuit@reddit

Just another scummy agency looking to rip someone off

[-]

blamordeganis@reddit

Where in UK? In Scotland, a holding deposit has to be returned regardless of why the tenancy didn’t go ahead (e.g., you just changed your mind before signing the lease); and if the tenancy does go ahead, the holding deposit has to go towards your security deposit or your rent (i.e., it’s money you would have paid anyway). https://www.citizensadvice.org.uk/scotland/housing/renting-a-home-s/starting-a-tenancy/problems-with-fees-and-deposits/

[-]

DankestDaddy69@reddit

Yeah no, the only deposit you should pay for an apartment should go to the TDS and no where else. Doesn't matter how nice the flat is, this is a big red flag.

[-]

trillospin@reddit

A holding deposit is legal and completely normal.

[-]

prismcomputing@reddit

purely illegal

[-]

frogdances@reddit

Partially. If you withdraw they're entitled to costs.

[-]

leapyeardi@reddit

They can keep it only if you've been misleading in your application.

[-]

Simonh1992@reddit

Not sure why you were downvoted, this is more or less word for word as per the Shelter link in comments above. “For example, you should get your holding deposit back if you fail a credit or reference check, as long as you give honest and factual information.” The implication being if someone knowingly lies on their application, eg not having a CCJ as an example, (unsure what is exactly asked on an application) but it transpires they did, it could be withheld.

[-]

randomusername468@reddit

Lol screw them ….. they’re 100% screwing people out of deposits.

[-]

TartanGuppy@reddit

I'm no expert but had a quick look..... [https://england.shelter.org.uk/housing\_advice/tenancy\_deposits/holding\_deposits/fail\_referencing\_or\_credit\_check](https://england.shelter.org.uk/housing_advice/tenancy_deposits/holding_deposits/fail_referencing_or_credit_check) If you fail a credit check or referencing The landlord or agent must usually return your holding deposit even if: you fail an affordability or credit check they are not happy with your references You should get your holding deposit back in these situations, as long as you gave honest and accurate information. [Find out what to do if your holding deposit is not returned](https://england.shelter.org.uk/housing_advice/tenancy_deposits/holding_deposits/holding_deposit_not_returned).

[-]

QuietAnxiety@reddit

This is a great reply. If you have biscuits you deserve one.

[-]

wabbit02@reddit

>Should you change your mind prior to entering into the Tenancy, or the Landlord is forced to withdraw as a result of references which are not forthcoming If you withdraw then they can reclaim costs. >or which could not reasonably be considered as satisfactory, you will lose your holding deposit to cover our costs incurred.” if they withdraw or impose new terms/ requirements then essentially it would be illegal under the tenant fees act.

[-]

ernie_milkie008@reddit

I would ensure you pay by credit card, and if it falls through claw back the costs. Is it over £100?

[-]

sandio90@reddit

Section 75 on credit card only covers purchases, OP's deposit will be classed as a cash transfer not a purchase if they use a credit card.. and that's if they are even allowed to depending on credit card type

[-]

19flash92@reddit (OP)

Yes £350, is it possible to transfer to an account and sort code with a CC? I have one but rarely use it.

[-]

TimberWolfForest@reddit

I had this, an estate agent had a lot of viewings one day, then on Monday afternoon I got a call begging me for a deposit, and the rent was what it was advertised. Red flags! I knew they were pulling some kind of grift like you've described. I said I wanted a cast iron agreement before deposits. They refused. I said no deposit then.

[-]

buymybone@reddit

They can do that but unless they're scammers or total dipshits it's not worth it in the long term.

[-]

Grotbagsthewonderful@reddit

No idea how common that is but you'd have to be a fool to agree to those terms.

[-]

AutoModerator@reddit

**Update: - [Starting from 2023](https://www.reddit.com/r/AskUK/comments/100l56v/happy_new_year_askuk_minor_sub_update/), we have updated our [subreddit rules](https://www.reddit.com/r/AskUK/about/rules/)**. Specifically; - Don't be a dick to each other - Top-level responses must contain genuine efforts to answer the question - This is a strictly no-politics subreddit Please keep /r/AskUK a great subreddit by reporting posts and comments which break our rules. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/AskUK) if you have any questions or concerns.*