BM calls for deposit protection awareness push

Under the new regulations, from 6 April all landlords will be required to protect their tenants' deposit using one of three government-authorised schemes. Within fourteen days of receiving the deposit, the landlord is then required to inform the tenant of how it is protected.

Landlords can choose from three schemes:

• The free custodial scheme requires the full deposit amount to be placed into the scheme until the end of the tenancy.
• Two insurance-based schemes allow landlords to retain the full deposit amount themselves. These schemes require a fee to join, and a premium is payable for each protected deposit. Only any disputed amount is passed to the scheme at the end of the tenancy period.
• All schemes provide free dispute resolution for any problems at the end of the tenancy.

If landlords fail to comply:

• Tenants may apply for a court order demanding that the deposit is protected or repaid
• A fine of three times the deposit amount will be payable to the tenant
• Landlords will lose the right to repossess their property under the 'notice only' method

Iain Williamson, head of key accounts at BM Solutions, said: "Tenancy Deposit Protection ensures that the good practice already employed by the vast majority of landlords is mandatory throughout the industry. As a lender, we'll continue to help make intermediaries aware of the changes and help landlords to understand their obligations. Tenants also need to check that their own deposit is protected. On our website, there's a fact sheet outlining the key changes. If everyone understands their responsibilities, it's a positive move for buy-to-let."