Yeah your point about the previous deposit still being held is one of the worst parts. You’ve often got to come up with a whole second deposit basically, so this certainly seems to be a big benefit of Fronted if they can remove that problem.
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last time I was looking for a place to rent, one of the agents offered a “deposit free” option
This was fine, except that it meant paying an increased rent for the entire time you were in the property - so even when you had paid the full deposit value, you were still paying extra. I no-longer have the figures to hand, and they don’t advertise the costs until you go to the viewing, but I also remember thinking the interest rates were quite high
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I’ve had some further thoughts.
Most agents seem to offer zero deposit guarantees to tenants now where they’re charged an insurance premium of around 1 week in rent, no deposit, and are fully indemnified from any future deposit claims by the landlord.
Why would anyone choose to pay a fee to ‘front’ a deposit rather than paying the one off fee for a ZDG?
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I might be wrong but are there not credit checks/credit requirements for those kind of schemes?
Maybe I’m in the minority but I’ve never encountered this or heard of any of my friends doing so either. Renting in London for the past 6/7 years, mostly central-north personally but friends fairly widely spread.
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Surely if you can’t afford a deposit you shouldn’t even be looking to move. This would send alarm bells ringing for me as a landlord.
Someone being able to afford £X a month is different to also paying 2 or more times X in at the start as well. Huge outlay all at once.
And then, as said above, you often have to come up with a second deposit when you move cus your first one will be tied up for a few weeks minimum.
Deposit aside…the way the housing market calculates whether people can ‘afford’ something is a mess. Most people pay more, sometimes substantially so, in rent than they would on mortgage payments, but banks say they couldn’t afford to keep up with a mortgage unless they pay a huge deposit in the first place? Thereby making them pay more in rent and not be able to save up for said house deposit as quickly.
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It’s the classic “poverty finance” type thing that generally target those less well off, and end up spending more over the life of a product than if one had the cash reserves to buy up front.
Not saying that this isn’t a useful service if it does indeed remove a blocker to people being more mobile in respect to housing, nor do I think it’s predatory, but it does land in a part of difficult/broken housing system that could be a lot better.
Housing isn’t some luxury after all - it’s a basic human need - and the exploitation that exists around that irks me somewhat.
I do wonder if these are more common place as a result on limits on charges that can be made for a new tenancy / max deposit requirements?
Referencing fees, contract “writing” fees etc used to be the trick, which I think we abolished - so is this just the new way to extract money from tenants now?
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What an odd thing to say.
I know plenty of people who don’t have the £2,000+ needed to just move flats readily available.
There are many reasons you may need to move, several of which may be out of your control.
Good for you if you are able to do so. I sure hope you’re not a landlord then.
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If you’re stuck with a shitty landlord or need to move for career-related reasons you might not have a choice.
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Just to be clear, ZDGs protect the landlord. It doesn’t absolve the tenant from claims being made for damage to the property.
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If you read the terms and conditions for these deposit alternatives, you’ll see they don’t indemnify the tenant against claims by the landlord… They only protect the landlord in the case the tenant refuses to pay the landlords claims.
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