Some unscrupulous landlords are either very slow to return deposits at the end of the tenancy or make unfair deductions.
[3] The tenant pays over the deposit (commonly one month's rent) in the usual way when the tenancy agreement is signed.
The landlord or letting agency has 30 days from receipt of the deposit to provide the tenant with details of the scheme that they are using (known as the prescribed information).
If at the end of the tenancy the landlord does not release the deposit, the insurance will pay back the tenant.
If a landlord or letting agent does not both protect a tenant's depositt and provide the tenant with the prescribed information within 30 days then they are prevented from regaining possession of the property under a Section 21 notice under the Housing Act 1988, unless the deposit is first repaid or proceedings for a penalty against the landlord, or its agent, has been initiated and settled.
Even if the deposit is registered or the prescribed information is given at any time after the 30-day window the tenant still has a right to make a claim.
Tenants can also now make an application to a county court for a penalty award after the tenancy has ended.