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New tenancy deposit replacement product launches

Another tenancy deposit replacement insurance scheme has been launched – this time by Goodlord.

The property technology firm is offering the deposit replacement insurance product to letting agents, with a view to providing renters with an alternative to a traditional tenancy deposit.

Through the new offering, agents can provide landlords with eight weeks of protection, which is three weeks’ more than a traditional tenancy deposit, which will be capped at five or six weeks (dependant on annual rent) under the Tenant Fees Act.

Oli Sherlock, head of insurance at Goodlord, said: “We’ve listened to the concerns our customers had around other deposit replacement schemes in the market and, as a result, have built an insurance-backed deposit replacement scheme that offers our customers more security, with up to eight weeks’ protection for landlords.

“Goodlord’s Deposit Replacement Insurance is also white labelled, which means our letting agencies can ensure complete alignment with their own brands.”

It is important to note that deposit replacement insurance is growing increasingly popular as it also provides agents with a new revenue stream.

Goodlord’s CEO, William Reeve, said: “After a successful testing period with a select group of our customers, we’re excited to now offer deposit replacement insurance to all the agencies we work with.

“This will help to put agents in a good financial position ahead of June’s tenant fee ban, enabling them to offer landlords significantly more protection than a traditional tenancy deposit, and making moving home easier for their tenants.

“The Goodlord platform ensures the process is completely transparent and seamless for all parties.”

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Poll: Are you a fan of tenancy deposit replacement insurance schemes?

PLACE YOUR VOTE BELOW

  • icon

    If a tenant can't afford the deposit, it doesn't bode well for being able to pay the rent regularly without any problems.

  • icon

    All new tenants after 1st june will be paying an increased rent to cover the short fall on deposits held and agents fees charged to landlords, every time they hit the landlord it's the tenant that comes off worst.

  • Paul Barrett

    Yep I will still be taking 2 months rent as a deposit.
    I would never take anymore than that.
    Of course the additional 3 weeks deposit over the statutory 5 weeks WON'T be described as such.
    I will spread it over a 6 month period.
    I will then issue a new 6 month AST with a rent reduction.
    Of course I will advise that if desired then I would have no problem if the tenants wished to surrender early the 2nd 6 month AST.
    So that effectively the 2nd AST is just a periodic tenancy.
    At the expiry of that 2nd 6 month AST the tenants vacate I will refund the deposit and as a goodwill gesture I will donate a proportion of my rent income equivalent to 3 weeks of deposit to the tenant or anyone they may wish me to donate to.
    Perhaps a child's savings account etc
    Cos I'm a jolly nice chap.
    Job done.
    Of course what will have happened is that 3 weeks of the deposit WON'T have been protected.
    Govt must think LL are stupid.
    It cannot ban LL making donations of rent as a goodwill gesture.
    There are specific reasons why taking more than 2 months rent as a deposit is inadvisable.
    Govt should have restricted the deposit to no more than 2 month's of rent.
    It costs me a bit of printer ink to produce the documents for a 2nd AST.
    I of course add the cost of protecting the deposit for a 2nd time in the 1st 6 month's rent.
    No lawyer could ever prove what I choose to do.
    No intent could ever be proven.
    The other way would be at the NTQ I would only require 1 weeks rent for the last month and would attach an appendix to the TA accepting that I decided to reduce the rent in the last week which would be very similar to the 3 weeks of deposit that Govt restricts me in taking.
    Silly old Govt thinking it can beat me!!

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