When you sign for a property you may need to pay some money up front. It is illegal for Landlords or Agents to charge a signing fee to create the tenancy, but you may need to pay holding fees, deposits and the first rent payment.

What is a Holding Deposit?

Some landlords will charge a holding deposit to take the property of the market while they check your references and right to rent. This is more likely from landlords in the "professional" market, but some landlord who let to students will take a holding deposit.

The landlord or agent might keep your holding deposit if you:

• Decide not to rent the property
• Give wrong information or tell them something that is false
• Do not pass a right to rent immigration check

They should not keep the deposit because you fail a reference or credit check, provided you have given them all the current information truthfully.

If you decide not to take the property because you discover a problem with the contract, or other problems with the property you may be able to claim this deposit back, but it is always best to view the property and check the contract first.

A good landlord (and this is a requirement of the Unipol Code) must allow 24 hours for you to check to contract during which you have first refusal on the property, but they may still make a charge.

What is a Deposit?

A deposit is an amount of money, often one month’s rent, that a landlord keeps until the end of your contract. The deposit protects them (and you) if there is any damage or unpaid rent during your time in the house. Landlords must protect your deposit in a deposit protection scheme.

For tenancies signed after 1 June 2019 the deposit cannot be more than 5 weeks rent, or 6 weeks if the full cost of the rent (for everyone together) is more than £50,000 a year.

If you live in University accommodation or with the owner of the property they don’t have to protect your deposit.

Here’s a few tips that are good to know when handing over deposit money:

• Never pay a deposit until you have signed your contract, if you change your mind over the house you could lose your deposit.
• If you pay cash for your deposit get a receipt and attach it to your housing contract so it doesn’t get lost.
• If you pay a ‘holding deposit’ check the conditions because the landlord could keep your money if you decide not to sign your housing contract.
• Once you’ve paid a deposit, most landlords will have to protect the money in a tenancy deposit protection scheme within 30 days. Your landlord has to let you know which scheme their with when they give you your tenancy agreement.

You may not be able to get the keys and move in until everyone has paid their deposit

Advance Rent

You will need to pay the first rental payment before moving in, and some Landlords will ask for this when you sign for the property, but if the property does not start for some time you should not pay this until a few days before the tenancy starts (so the payment clears for the first day). 

You may not be able to move in if anyone has not paid their share of the rent.