Why was the Tenancy Deposit Scheme Introduced?
It is common for landlords to take a dilapidation deposit from a tenant at the start of the tenancy. The deposit acts as a safeguard should the tenant cause any damage to the property. Some unscrupulous landlords are either very slow to return deposits at the end of the tenancy or make unfair deductions. The purpose of the new regulations is to ensure good practice in this area. The secondary purpose of the new regulations is to try and keep disputes between landlords and tenants out of the courts by encouraging alternative dispute resolution.
For comprehensive information on the legislation follow this link:
In November 2006 three companies were awarded contracts by the UK government to run tenancy deposit schemes:
- The Deposit Protection Service (The DPS), a custodial scheme. http://www.depositprotection.com/
- Tenancy Deposit Solutions Ltd (TDSL), an insurance-backed scheme. http://www.mydeposits.co.uk/
- The Dispute Service (TDS), an independent, not-for-profit company. http://www.tds.gb.com/