Friday, March 23rd, 2012

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Welcome to Deposit Claim

Wednesday, January 4th, 2012

Welcome to, the online resource for landlords making claims on protected deposits. Claiming can be frustrating, stressful and time consuming. We aim to give you all the information you need to be in control of the process and, above all, to get the money you need to keep your property in good condition.

If you have a deposit protection problem, we can help you:

We help landlords, tenants and letting agents who need help with any aspect of deposit protection. We most commonly help landlords to claim protected deposits, but also help tenants recover overpaid rents, landlords who are sued under deposit protection legislation, agents having trouble claiming on behalf of landlords

Have a look around the site. You’ll see we know what we’re talking about and are the only people offering specialist deposit protection advice.

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DPS shortfall is around £30 million

Monday, July 25th, 2011

Looking at the last line of my previous post on this blog, I think it is fair to say that I spoke a bit too soon.

I for one am impressed that the DPS, which is funded by the interest on the deposits it holds, has managed to keep going through such a long period of rock-bottom interest rates. Surely their contingency planning couldn’t have foreseen what is a sea change in fiscal policy. All power to them for adapting to a rapidly changing environment.”

It emerged in the press this week that the DPS had a clause in it’s contract with the government which required central funds (or The Taxpayer, if you read the tabloids) to bail out the DPS if it didn’t make enough money from interest alone. With interest rates so low for so long, the DPS, which is funded by interest on the deposits it holds, had gone cap in hand to the treasury, admitting to a projected shortfall of over £30million over the life of the contract.


Reading between the lines it seems that the then new coalition government weren’t particularly pleased at the contractual terms they inherited from their labour colleagues and renegotiated the agreement with Computershare, the multinational corporate giant who run the DPS. In exchange for a four year extension to the contract, which will now end in 2016, the DPS accepted more than a 50% reduction in the fees payable to just £12.7 million. £12.7 million sounds like a lot of money, granted, but to a business expecting a cast iron guaranteed £30 million, it represents a massive shortfall and must have some serious implications for the cash flow forecast. 

I don’t think that landlords or tenants need worry about the safety of the deposits, as the government is clearly committed to backing the scheme and, at any rate, the deposits themselves will be in a ring fenced client account. What intrigues me is how the DPS were able to accept such a significant reduction in their fee structure? It seems to me that either the original agreement was extremely favourable to the DPS and they are in a good position to adsorb the loss, or the DPS have taken a gamble on interest rates rising sufficiently over the lifetime of the contract to enable them to recoup any losses over the longer term. No doubt rates will rise over the medium term, and if the DPS can stay in business long enough it is bound to reap the rewards, but exactly when rates will rise remains to be seen, especially while anyone on the Bank of England Monetary Policy Committee who votes for a rise in the base rate is invited to dinner at number 10 and promptly changes their mind…

…As for the Taxpayer, it is worth noting that £12.7million represents relatively good value. Over the six year term that was renegotiated, the DPS can expect to protect something like 3 million deposits, so the scheme only costs us around £4.25 per deposit to run, compared to £30 to use MyDeposits, so it’s not all bad.

Cosmetic Developments in Deposit Protection

Monday, July 11th, 2011
The three deposit protection schemes have been actively updating their public presence of late and it seems to be paying off. My Deposits has just unveiled a very swish new website which has garnered them some good publicity and looks very user focussed and clean. TDS have recently received five accreditations from the Plain Language Commission for some of their key dispute documents which, to be honest, needed a bit of simplifying. All credit to them for improving their service. The DPS, meanwhile

have brought in a virtual assistant on their website, called Ask Emma. Although I haven’t had cause to ask Emma anything yet, giving customers alternative means to contact the organisation can be no bad thing. Please leave a comment if you have asked Emma anything and let us know whether she was helpful.

The fact that the three feel the need to constantly work on their appearance, as it were, highlights that deposit protection is still a very competitive business. It seems as though the doomsayers who have until late predicted the imminent demise of the insurance backed schemes were wide of the mark, but then, as far as I could tell, they were much the same doomsayers who predicted that the custodial scheme would crash in the first year.

The fact is that as long as agents want to sit on the interest from the deposit and can get away with passing the insurance premiums on to the landlords, the insurance based schemes are on a reasonably firm footing. I for one am impressed that the DPS, which is funded by the interest on the deposits it holds, has managed to keep going through such a long period of rock-bottom interest rates. Surely their contingency planning couldn’t have foreseen what is a sea change in fiscal policy. All power to them for adapting to a rapidly changing environment.


Happy Deposit Protection Dispute Clients

Monday, July 4th, 2011
I thought I would share some recent testimonials with you from satisfied customers.
“I can highly recommend Tom’s services. He has always been very helpful and willing to go the extra mile. He has a great level of expertise and knowledge. He has saved me a huge amount of of time and effort when having to deal with property issues. His company offers a very unique service which is extremely useful to any landlord who manages their own property. I have found him extremely good value for money!” 
C. Surujpaul, London

“I could not recommend them highly enough. Thomas Derrett helped me settle an extremely problematic situation, and with his expertise, experience, professionalism and charming manner, I could not have asked for a better service. His thoroughness and inside knowledge took the pain out of an extremely stressful situation, and when I was called abroad on business he pretty much handled the whole case on his own. He knew how to present my evidence in a concise and correct way, and the final judgement was happily, fairly, and correctly completely in my favour. I am extraordinarily grateful to him.” 
D Moxon, Brighton
“Toms advice, knowledge and approach has not only impressed my clients but I have also benefited from his presentation and explanation of the system to pass onto my staff. My portfolio has grown significantly since using Deposit Claim’s unique service. This insider knowledge and outside of the box thinking has improved my product, presentation and extra service as an expert. Tom is always available on the telephone and replies comprehensively to any emails.” 
L Bailey, Hertfordshire
It is always nice to be appreciated

Student Deposit Dispute Season

Tuesday, June 28th, 2011
If the weather is anything to go by, summer is upon us already, which can only mean one thing for thousands of landlords up and down the country: student changeover time.
In my, admittedly anecdotal, experience adjudicating deposit disputes, there are three groups of people responsible for significantly more damage to rented property than everyone else put together. They are:
  1. Barristers (the shame!)
  2. Doctors. I saw a defence from a tenant once that read “I don’t have to clean, I’m a doctor”. They didn’t win.
  3. Students. It’s no surprise really. Students have a well deserved reputation for trashing properties and there will be very few student landlords who don’t need to make a claim on any protected deposits this summer, so here is some advice for landlords in the run up to changeover season.
As the end of the tenancy approaches, send your tenants a letter reminding them of their obligations. Point out any relevant terms of the contract that might prompt them to clean up and tidy garden. Remind them that they have a copy of the inventory, or even give them another copy, and gently suggest that the inventory provides a useful guide as to how the property should be left, subject to fair wear and tear, of course.

Make an appointment with the tenants to check-out the property when the last one leaves. If they are going home before the end of the tenancy, you can hold the check-out early provided they voluntarily hand over their keys. If you come to an agreement at the check-out meeting regarding deductions from the deposit, make a note there and then as to how much was agreed and what for, and have the tenants sign it.

Sometimes, even with the best will in the world, relations between landlord and tenant break down over repayment of the deposit. One of the pitfalls of student letting is that indignant parents who couldn’t possibly believe their little darling could be responsible for any damage wade in with their best legal sounding letters. If you find yourself in a pickle over a deposit, with a difficult parent giving you a hard time, please call us. We will always do our best to make sure you get a fair deal, and can even deal with the tenant or parent on your behalf, which can be very helpful if you are no longer able to have a constructive discussion.

Better Inventories Required

Monday, June 6th, 2011
Better Evidence For Landlords
I have been very busy recently getting a new project off the ground which could really change the fortunes of landlords and letting agents in deposit protection disputes. 
The Problem With Inventories
All too often landlords lose deposit disputes simply because their inventory evidence doesn’t show what they need it to show. Inventory clerks tend to focus their attention on any parts of the property that are already damaged, whereas what landlords require is an inventory that shows the property in it’s undamaged condition at the beginning of the tenancy. Only with concrete evidence that the property was in good condition to start with can the landlord show that the tenant is responsible for any change in condition – damage to the property.
Ordinary inventories tend to come with a dozen or so photographs by way of supporting visual evidence. It is simply not possible with a few photographs to categorically demonstrate the condition and cleanliness of every part of every wall, every metre of skirting board, or the inside of every kitchen cupboard. 

A New Inventory

I have been working closely with the Video Inventory Network on their video inventory training course, developing a system that enables inventory clerks to take an average of 60,000 still images per inventory to corroborate their work.

The answer, of course, is to use a video camera to record 25 still images per second while conducting the inventory, enabling the clerk to provide close up images of every part of the property at no additional cost to the landlord.

The landlord receives a detailed written report as usual with chaptered DVDs of corresponding video, which the tenant can view and sign. If the tenant later disputes the landlord’s proposed deductions from the deposit, the landlord will have the written inventory, corroborated by visual evidence, which will show any given part of the property in the condition it was in at the beginning of the tenancy.
This could really redress the balance in deposit protection disputes.
Find Out More
The Video Inventory Network run two-day training courses on how to carry out video inventories. The course is ideal for landlords or letting agents looking to carry out high quality inventories in house, for experienced inventory clerks who want to add video inventories to their available products, and for those new to inventories wanting to set up a full time or part time inventory business.
See for more details.

Useful Guidance From The Deposit Protection Schemes

Monday, May 9th, 2011
I was very pleased last week that the deposit protection schemes have finally got together to offer some joint advice on the dispute process. The advice itself is very practical and if you are involved in a dispute, I would recommend you read it. Each scheme has published their own version, but I am assured the text is the same in each. Even I am not dull enough to compare them. Read the booklet here:
What pleases me most about this publication is not the advice itself. Although undoubtably useful, there is nothing new or unexpected in there. I am most pleased that it shows the schemes are working together to ensure common standards across adjudications.
One of the things I have had difficulty with since I began advising landlords on deposit claims is explaining that the likelyhood of any given claim succeeding varies greatly depending on which scheme they use. I avoid expressing my opinions on the relative merits of the schemes in order to maintain a professional, detached stance, but like everyone else in the industry, I know which scheme you are more likely to get a sensible decision from and why.
The fact that the schemes seem to have been able to work together on this booklet bodes very well for the landlord. Further co-operation may eventually lead to a uniform method of managing and deciding disputes which, while it won’t tip the scales in the landlord’s favour, may well iron out some of those frankly unjustifiable decisions which can give the schemes a bad name.


The Future Of Deposit Protection Disputes

Tuesday, April 19th, 2011
I had a really enjoyable day last week giving an inventory masterclass to the experienced team at Inventory House in London’s Docklands, who had asked me to consult on the format and content of their inventories. Their inventory product is already very professional and the guys really know their business inside out, so we were able to delve very deep into what makes a great inventory, touching on subjects as diverse as how deposit protection adjudicators arrive at decisions and awards, how to maintain admissibility of evidence for criminal court and how language is used to describe phenomena in quantum mechanics.
One of the recurring themes of the day was whether the deposit protection dispute model as currently practiced is sustainable and how the inventory industry, and other interested parties, might be able to influence any developments.
Several questions kept recurring which included: 
Whether the methodology for resolving disputes through adjudication could be standardised, as there is a feeling that the standard of proof was interpreted differently across the schemes?
Whether the schemes could agree a baseline of expected lifespans for commonly claimed for items (such as carpet) in an average tenancy, to prevent landlords claiming with unrealistic expectations, or unnecessarily pursuing claims that are without merit?
A feeling that the trained inventory professional’s opinion is underused led to discussion of whether a (self?) regulated inventory industry adhering to common standards could remove some of the burden from the deposit protection schemes’ dispute resolution departments?
Answers on a postcard please…

Preparation, Preparation, Preparation

Monday, March 28th, 2011
As a landlord, the onus is on you to take action to avoid deposit disputes and to ensure that you win the ones that you cannot avoid. There are a few things that you can do that will really help.

1. Tenancy Agreement
Without a signed tenancy agreement you can forget all about winning any dispute. That said, just getting a pre formatted tenancy agreement from WH Smiths may not protect you as well as you hope. There is no substitute for spending half an hour with a lawyer you trust when it comes to getting a legally compliant agreement that contains all the clauses you need for your particular circumstances. It may cost a bit more, but you will probably reuse it many times during your letting career.
2. Protect The Deposit
If you don’t protect the deposit properly, you run the risk of losing the dispute on a technicality. If you don’t protect it at all, you may end up giving all the deposit back to avoid being sued by the tenant…   …or worse.
3. Get An Inventory
Landlords who do their own inventories or, worse, don’t bother at all, are leaving themselves wide open. Without a record of what the property was like when the tenant moved in, they could gut the place and you might not win a claim on the deposit. I’ve blogged about inventories before here.
4. Hold A Check Out Meeting
It is considered best practice to invite the tenant to the check-out meeting. I have heard rumours that some adjudicators are now insisting on it, although I haven’t seen any evidence yet. Invite the tenant by email if possible, so you can prove you did so, and if they want you to reschedule the meeting and it’s not too much bother, do so. The statistics show that where the tenant attends a check-out with the landlord or inventory clerk, they are much less likely to dispute your claim on the deposit.
5. Give The Tenant A Notice Of Dilapidations Within 10 Days
If you do have to claim on the deposit, give the tenant notice of what you intend to claim for and an estimated cost within 10 days. Some of the schemes insist on it and it is good practice in any case. If your estimates turn out to be inaccurate, explain why to the tenant. Don’t add items after the 10 day deadline unless you really have to. It looks bad if the amount keeps going up and up. It will only make the tenant want to dispute your claim, where a small compromise on cost might save you a lengthy dispute.

Tom Derrett is a Deposit Protection Consultant and runs ADR Solution, helping landlords and letting agents to claim protected deposits.