Landlords and letting agents often take a holding deposit when you apply for a tenancy to cover their costs if things go wrong.
If you have started a tenancy then your holding deposit can be counted towards your security deposit or the first month’s rent. Check what payments you are being asked for so that you don’t pay twice.
If you have not started the tenancy, the holding deposit should be returned if any of the following apply:
- The landlord decided not to proceed with the tenancy – but you wanted to
- You were unable to start the tenancy after 14 days despite your best efforts
- You didn’t want to start the tenancy because you were asked to pay an illegal fee (or do something else that is banned by the Tenant Fees Act), or the landlord/agent’s actions made it unreasonable to expect you to proceed with the tenancy (e.g. by including unfair terms in the tenancy agreement or acting in a harassing or aggressive way)
The landlord can retain the holding deposit if you:
- Decided you didn’t want the home, and the terms you were offered were fair
- Provided inaccurate information
If you have not received your holding deposit and you believe you are entitled to it then contact your local council’s trading standards team or the redress scheme your letting agent belongs to (either the Property Redress Scheme or the Property Ombudsman).
Rules on holding deposits came in in 2019 and we want to know if they are working. If your holding deposit is withheld illegally, please let us know here.
Read the government’s guidance on holding deposits on pages 12-15 here.