What happens if the deposit doesn’t cover the cost of damage?
We explain what you can do if repairing damage caused by tenants exceeds the deposit amount
In an ideal world, all tenants would pay for the damage they cause.
However, the reality is that if a tenant has treated your property with so little care that the cost of making repairs is greater than the amount held on deposit, they’re unlikely to compensate you willingly.
If there is a guarantor for the tenancy, you should approach them with your evidence – the check-in and check-out inventories and quotes for making repairs – and request that they pay on the tenant’s behalf.
Paul Sowerbutts of Landlord Action, Total Landlord’s partner and one of the UK’s best-known eviction and housing law specialists, adds:
The final thing you can do, if neither the tenant nor any guarantor is prepared to pay, is make a legal claim against the tenant. As long as the amount is under £10,000, you can use the county court small claims procedure and apply online. It’s cost-effective as no solicitor is involved. You may well still need to enforce the order, but the order will last six years.
However, the court needs to write to the tenant, so if they haven’t left a forwarding address and refuse to respond to emails and calls, it can be hard to pursue them.
As such, the best way to protect yourself is by having landlord insurance that covers you for damage caused by the tenant.
And, given that tenants can build up rent arrears that are much greater than their deposit, it’s also well worth considering rent guarantee insurance.
Most tenants do look after their rented home well, but there will always be some that are either careless or cause damage deliberately. In a worst-case scenario, you might get a tenant who sets up a cannabis farm in the property, which could cause structural damage that will cost thousands, if not tens of thousands to put right – meanwhile, you’re also losing rent while the property can’t be let. So, we recommend landlords always make sure they have a robust landlord insurance policy to protect them financially in case their tenants maliciously damage their property, leaving them with a bill that’s far higher than the deposit they hold.
