Q&A: Nil Deposit Scheme

News at Thorgills | 07/02/2019




How does it work?

Thorgills has a partnership with Let Alliance which allows us to offer a Nil Deposit scheme, benefitting both our landlords and tenants.

Instead of providing a five-week deposit, tenants can pay the equivalent of a single week’s rent plus vat, followed by a nominal monthly fee for liability insurance – reducing their up-front costs and making it significantly easier for tenants to move.

Landlords benefit from the scheme too, since their property becomes available to more people as the cost of moving home is lower.

Am I still protected as a landlord?

Yes - Let Alliance provides landlords with a guarantee of up to six weeks’ rent if a claim is made against a tenant. This functions in the same way as a normal security deposit, but actually offers greater cover, as the guarantee is for up to six weeks' worth of rent but under the new laws tenants only provide a five-week deposit..

This means that even though the tenants have not paid a deposit, Let Alliance provides you with an even better level of protection and security.

Let Alliance will even make the necessary payments to you before seeking reimbursements from the tenant, meaning that you may receive compensation more quickly than you would from a regular security deposit.

Can the scheme benefit me as a landlord?

In addition to providing you with better protection for your property, the scheme also benefits you as a landlord by making your property more accessible for potential tenants, as it reduces their cost of moving.

This means that more potential tenants will be interested in the property, which could reduce void periods, offer landlords a choice of tenant, or even enable the tenant to pay a higher rent as their initial costs are lower.

I’m a tenant – how does this benefit me?

A security deposit is normally the largest up-front payment you will have to make as a tenant moving into your new home. Even for smaller properties this can often stretch to thousands of pounds.

The Nil Deposit scheme allows you to reduce your up-front costs, making moving home much more accessible. This could even mean that you could afford a little more rent and move into a nicer property, or perhaps nicer furniture for your new home.

You can find out more about the Nil Deposit scheme .

You can find out more about our other market-leading lettings services here: Experian - Nil DepositSame-Day Referencing