Shelter is launching a campaign to help private sector tenants reclaim fees which it claims are being illegally charged by rip-off letting agents.
In Scotland, agents are banned from charging ‘unlawful premiums’. The Scottish Government is currently consulting on clarifying the law, so that people know exactly what these are.
However, Shelter Scotland says that agents are deliberately misinterpreting the existing law, as laid down in the Rent (Scotland) Act 1984, and exploiting ‘thousands’ of people.
It is launching a website, encouraging tenants to write to their letting agent and asking them to return fees that they should not have been charged.
The site says private tenants can reclaim charges for services such as credit checks, reference checks, preparing and checking an inventory, and other up-front fees.
Alongside the website, a Reclaim Your Fees campaign team will tour Scotland’s largest cities and universities to give tenants advice on unlawful fees.
Graeme Brown, director of Shelter Scotland, said: “More than 272,650 families and individuals in Scotland call the private rented sector home, and that number is rising.
“That some letting agents – established and new – are routinely ripping off tenants by charging extortionate and unjustified upfront fees is shocking and quite simply exploitative.
“They are not only ripping off people who need a roof over their head and who, in many cases, have little or no choice but to pay up, but they are also undermining the work of good letting agents who offer a fair deal to tenants.’”
www.reclaimyourfees.com
Comments
The majority of landlords and letting agents let property as a business concern - in other words to make money from their investment and their are risks involved with this.
The greater the income from your investment the greater the risk and the housing market has a massive potential for reward and so has a higher risk factor than say, leaving the money in a bank (so you invest £10,000 to £20,000 and after 20 years you own the property fully worth £200,000 a ten times increase in your investment)
One of these risks is that your customers are 'bad'. If you are not prepared to have the odd bad customer then you should not be in a business offering such high rewards - stick your money somewhere safer.
It is not the tenants requirement that they are checked, it is the landlord and they should make arrangements to satisfy themselves without charging the tenants - these checks should be built into their business model. So yes, the premiums are unlawful, this is clearly stated and EVERY tenant should reclaim them for current and past accomodation, but the landlords should also be aware of the legalities of their business and work out their if they can afford the risks.
Last point is that as a tenant would you be happy renting from a landlord that you know acts illegally? Landlords should not be charging this as a seperate charge purely for a trust issue with their customers.
Shelter should work to bring this law to England. It's illegal in Scotland and they are campaigning against in Wales. Urgent change is needed in England too.
@ IO
I'm suprised at your post. Yes it's the landlord who wants reassurance that the tenant is who they say they are, that they are financially stable and haven't trashed their last home. But the tenant figures in this as well; they are the ones who want a new home, they are the ones who want to be considered for a new property.
Try to imagine the carnage if it didn't cost a tenant anything to roll the dice; everyone and his dog would apply for a property regardless of their credit history if it was free.
We're not like other industries, we have a lot more interest in tenants than just the credit history which a £2 call to experian could get us.
@ Vinny
Why would England not follow Scottish Laws that benefit the consumer (and cost Govt nothing?)
Who wants the tenant vetted - the Landlord. Who wants the protection of a tenancy agreement - the landlord.
Who benefits most from an inventory - the Landlord as when it comes to condition end of tenancy the landlord goes by their opinion anyway.
I could go on but won't, but get the picture?
It is the Landlord who wants to be assured the tenant is who they say they are, work where they claim to, earn what they say, haven't trashed their last home, want an inventory of their items left in the property etc etc - not the tenant.
So why should the tenant pay when it is the Landlord that wants reassuring?
@ robin hood
You should be ashamed of yourself and if you cannot upload better posts than this not bother.
Typical shelter trying to protect the s..m finding free housing. Stop trying to act like robin hood and focus your efforts on the gov for housing. The continued added pressure on the private sector housing would worsen the position for the sc.m you are trying to house
England won't follow Scottish laws, if it did the English would get free university fees. Tenants need vetting so they should pay for it not the landlord. And for hose who say trust tenants, and they should be taken at face value it's plainly wrong, no other industry takes anyone on face value, you can't get a mobile phone without being checked let alone taking charge of a thousands of pounds of landlords property.
@ Ray
Doesn't matter what anyone else thinks, says, believes or wishes for.
What matters is what the Law says IF it is to be enforced. And the Law is very clear, always has been, and always used to be enforced until about 15 - 20 years ago.
It isn't a matter of "who pays" in the direct sense. It is a matter of what should not be charged, or at least not to a tenant, in the first place.
Did you know Landlords used to be charged the agent's newspaper advertising costs - oh yes they did many pre Right Move moons ago!!!
@ Scottish Observer on 2012-05-10 10:37:33
Quite right!
"The site says private tenants can reclaim charges for services such as credit checks, reference checks, preparing and checking an inventory, and other up-front fees".
What nonsense!
So who pays? Not the "Landlord" because he isn't a Landlord until he has a Tenant and if the so-called "Tenant" fails the checks they are not a Tenant - so who pays for them then?
Please answer Shelter Scotland.
The claims made by shelter re referencing fees are contrary to the Legal Advice given to mant agents. I am advised that a Landlord is entitled to insist that a Tenant demonstrates they are a fit and proper person to take on a tenancy. The same criteria applies whether buying a house, car or any loan purchase. All these businesses charge an administration fee. One of the main reasons for charging a fee is stop time wasters and fraudsters. Is Shelter expecting the Landlord to pick up the tab for these people?
The Scottish Government is shortly going to decide what charges are appropriate...why do Shelter not wait until then instead of creating a hiatus now.
Personally I think they have shot themselves in the foot ...why would I consider anyone with no income or homeless if my Landlord was not able to verify the status of proposed tenants before making a decision to proceed with them. Shelters stance will only have a negative effect on the struggling social Sector. No direct payment, capped Rents and now ....by the way.....pay for every Tom Dick & Harry who comes through your door who can make up any story they like at the Landlords expense!!!
Been warning about this for years. The Law in Scotland is very clear indeed - it is unlawful to charge a tenant anything AT ALL in conection with the preparation or renewal of a lease.
Agents have gradually nibbled away at this and introduced charges to tenants which as long as the tenants didn't object they got away with charging. If they did object then they refunded to those more alert tenants.
The clarification referred to has also been under consideration for some time - you can bet which way the clarification will go, a remionder that the Law says no charges so stop doing it. Only a weakness in enforcement has enabled agents to get away with these charges for so long, now the writing like last night's Apprentice, looks to be on the wall.
Enforcement will be easy - just get Trading Standards to pick on one or two agents as an example and fine them and the rest will soon stop. There should be no issue here for agents except, of course, that by charging tenants legitimate costs that Landlords should have continued to pay, as they always have, the agents have now made an interesting rod for their own backs.
This issue may appear to be of no interest to agents in England and Wales. I have also been warning them for years not to make excessive charges to tenants in case the Law comes into line with Scotland.
Wonder where Shelter will send their battle bus next?!!!!