Deposit Free Renting in the UK
Finding a rental deposit is not always an easy thing to do if you’re already on a tight budget; here are your options for securing your flat with a rental deposit alternative
Your Options for Zero Deposit Schemes
Many tenants are often put off when moving into a new home due to tenant fees and expensive deposits. The combination of a months’ rent, estate agent fees and having to pay a deposit at the same time can accumulate to thousands of pounds; and in many cases can deter people from renting, especially for those who are hoping to move in quickly. Here’s what you need to know;
What is Deposit Free Renting?
Deposit-free renting is an alternative to traditional security deposits, designed to help make moving into a new home cheaper and easier for both landlords and tenants. Rather than paying thousands for a cash deposit, deposit-free renting is a deposit replacement which can offer tenants pay a fraction of that price*.
How does deposit free renting work?
Deposit free renting allows you to rent a property without a cash deposit. Instead, renters may bee asked to pay a fee equivalent to a week’s rent, which is spread between tenants if there is more than one renter. Tenants are still responsible for any damage or unpaid rent on your rental property and will have to repay any outstanding costs at the end of their tenancy.
The information provided should be used as a general guide, so remember to check with your provider as deposit-free renting differs from company to company.
Zero Deposit gives you, the tenant, freedom from having to pay deposits. The Zero Deposit scheme replaces your traditional deposit with a one-off payment which is equivalent to a week’s rent.
Fewer Upfront Costs: Paying a one-off Guarantee instead of a deposit means that the start of renting is more affordable than having to pay an expensive deposit and a week’s rent at the same time.
New and Existing Tenants: You can apply for deposit-free renting whether you’re a new tenant about to move in or an existing tenant who’s looking to free up the cash from their current deposit.
Canopy’s DepositFree™ insurance is a great option for renters who don’t want to pay the high prices of cash deposits. Canopy replaces the cash deposit with an insurance premium which is designed to benefit the renter and cost less than the high rates you would pay on a traditional cash deposit.
Renters are covered: If you find yourself in a situation where you’ve lost your job or have become seriously ill and your rent is affected, the insurance premium means that Canopy will cover your expenses and pay your landlord or letting agent on your behalf.
Cost: The cost of DepositFree Insurance starts at 10% of a cash deposit for a 1-year lease + Insurance premium tax + a 10% Canopy Admin Fee.
Flatfair offers a fantastic form of deposit-free renting through its Flatfair membership. Rather than paying a costly security deposit, a Flatfair membership fee requires you to pay a one-off payment equivalent to one week’s rent and then you’re free to move in.
Rewards: If you’re a great tenant you’ll be rewarded with a tenant score that will help you shine on future rental applications. In addition, you could even be eligible for discounts!
Flatfair’s Online Platform: With everything online you can sort every aspect of your tenancy. So if there’s a dispute that needs to be resolved, or if you’re just about to move in – everything is accessible on the platform.
End of Tenancy: All charges for possible damages are made online, where you’ll also have the opportunity to dispute them should you need to. There is no need to go back and forth as everything you need will be on the platform.
FREQUENTLY ASKED QUESTIONS
If a no deposit option is available when you are looking to rent a property, then this option will allow you to rent without paying a deposit upfront. While you will still be liable to pay any arrears in rent or damages at the end of your tenancy, no deposit options can help you to move property without having to wait until you’ve managed to save money for the deposit.
Deposit-free renting is designed to free up money for the renter, replacing traditional deposit renting. So rather than locking away a large sum of money for as long as the lease lasts, the new tenant has to pay an upfront fee which is often a fraction of the price as a traditional deposit would be.
Tenants are responsible for damages to the property or unpaid rent, so will need to pay any outstanding costs at the end of the tenancy. If there is no damage to the property, then your tenancy ends, and you can simply leave. There is no need to wait around for a deposit to be returned.
Check the terms and conditions of your scheme for more information on end of tenancy fees.
Yes, you can rent without a deposit. Many private landlords and estate agents offering no deposit rental options as well as offering the deposit free renting scheme. With deposit free renting, renters will instead be able to pay in upfront fee of just a fraction of the normal tenancy deposit costs.
If you can’t afford a rental deposit, there are plenty of different help options available, such as;
- Deposit free renting scheme
- Rental deposit help from either local councils or housing associations
- Rental deposit guarantees
- Borrowing from friends and family
Why Choose Fablious?
There are all manner of deposit free renting schemes that each work differently. You’ll, therefore, need to understand the terms of each to decide which is most suited to you.
Deposit Free Renting is just one of the alternatives finance products, designed to make your life easier, along with Buy Now Pay Later, Credit Building and Saving Money offers here at Fablious. For more zero deposit schemes and other alternative finance solutions, visit our Solutions page.