Letting Agents Renewal Fees
I have rented my flat out since 2002. I paid the agent a tenant finding fee and then subsequent renewal fees until 2004. I was not happy paying these renewal fees (circa £500 pa) and have paid nothing since and have had no contact with them. I have not received any invoices or any correspondence since apart from a letter in 2007 relating to keeping the Tenants deposit in a separate account. This was sent to my previous address. I have since moved. They contacted my Tenant in 2006 who confirmed she wished to stay another year but since then no communication.
I still have the original tenant and she hasn't received any correspondence either apart from last June 2009 when she received a letter to say they were holding her deposit, which was registered with the Tenancy Deposit Scheme and she has a certificate of tenancy registration.
I want to issue my own Agreement with my Tenant but need to know where I stand legally. They of course have her deposit. I either contact them and then have the risk of them demanding their fees or I put her deposit aside and issue a new Agreement. Any advice appreciated!
From your question I take it
From your question I take it that the agreement with the letting agent was on a "let only" basis and that they simply charged you a fee for finding the tenant and referencing her as opposed to managing the property on your behalf.
What exactly does your original contract with the letting agent say about fees charged by them for renewing a tenancy with a tenant that they originally found?
There has been a relatively high profile case recently regarding agents and renewal fees but before I can give you any further advice I need to know what the exact terms of the original contract were regarding renewal fees. If you could let me know I will be able to give you further advice.
I am a Legal Advisor employed by Sarginsons Law and specialise in Civil Litigation matters. I deal with disputes between individuals and businesses including Landlord and Tenant issues, debt recovery and property disputes.
Telephone 02476 553181
Hi. You are correct that it
Hi. You are correct that it was done on a let only basis. I manage the flat. I unusually for me do not have a copy of any Agreement apart from a letter stating their annual fees (8% first year and subsequently 5%). I did pay these initially and then stopped. In hindsight I should have spoken directly to them to say I was unhappy with the charges but lack of correspondence meant this has gone on for many years without being resolved. I now want it resolved. It would be cheaper for me to issue her a new contract and put her deposit aside myselft as 6 years fees plus VAT will be expensive. Hope this additional info helps. Thanks
JEH
Hi Jane, Without knowing the
Hi Jane,
Without knowing the exact terms of the contract it is difficult to give you specific advice. However if the terms of the contract provided for commission to be paid on an ongoing open ended basis then that term may well be an unfair contract term.
A recent case brought against Foxtons by the Office of Fair Trading concerned renewal commission fees and the terms of Foxtons contracts regarding these commissions were found to be unfair. This was mainly as a result of the open ended nature of the contractual term, i.e. Landlords would have to pay renewal commissions indefinitely if the same tenant occupied the property.
As a result of this case many lettings agents have changed their terms and conditions and are also unable to enforce similar terms in their existing contracts.
I would therefore suggest that you contact the agents and tell them that you would like the deposit to be repaid directly to you so that you can transfer it into one of the approved Tenancy Deposit Schemes. You should also inform them that you will be dealing with all of the tenancy renewals yourself.
If they say that you must pay them outstanding commission fees you should inform them that you consider the commission fees to be an unfair contract term and you will not be paying them.
If you deal with the renewal of the tenancy and deposit yourself you must ensure that you comply with all of the requirements of the tenancy deposit scheme. Two of the schemes attract charges and one scheme is free for private Landlords. The link to the free scheme is below:
http://www.depositprotection.com/
For more information and guidance about the Foxtons case and renewal commission fees please see the following links:
http://www.oft.gov.uk/news-and-updates/press/2009/83-09
http://www.oft.gov.uk/OFTwork/consumer-enforcement/consumer-enforcement-completed/foxtons/qandas
I hope that this helps. If you encounter any problems please feel to come back to the forum for any further guidance.
I am a Legal Advisor employed by Sarginsons Law and specialise in Civil Litigation matters. I deal with disputes between individuals and businesses including Landlord and Tenant issues, debt recovery and property disputes.
Telephone 02476 553181