When renting through Chard, tenants have two deposit options. They can either pay a cash deposit at the start of the tenancy or opt for the Chard No Deposit Option (NDO). The NDO removes the requirement for a tenant to pay an up-front deposit yet will offer Landlords exactly the same level of protection as a cash deposit. As many people look to finance their lifestyles in a more modern way, our NDO will greatly benefit both Landlords and tenants.
Who pays for the NDO?
The NDO is paid for by the tenant(s) in monthly instalments.
How much does it cost?
The NDO costs 2.5% (+VAT) of the monthly rent for the first 12 months of the tenancy only and a further £90 annually. If the NDO is not renewed then the tenant would need to provide a cash deposit immediately or risk being in breach of their tenancy.
Tenants will also be required to take out their own Accidental Damage insurance policy.
When is the NDO paid?
The NDO monthly payment will be due at the same time as the rent.
How much does it cost to cancel?
There is no cancellation fee, and tenants can decide to provide a full cash deposit at any time during the tenancy at which point the monthly payments will cease. Any payments made to that point are non-refundable and subject to a minimum two months from the tenancy start date.
Who is liable for charges for damage to the property or the Landlord’s belongings?
When the tenancy ends, tenants remain fully liable to cover the cost of any damages or unpaid rent just as they would be with a cash deposit. In taking on a NDO tenancy, the tenant must still abide by all of their obligations as set out in the tenancy agreement.
What happens if a tenant accidentally breaks something during the tenancy?
Tenants will either simply pay for the damage at the end of the tenancy or make a claim on their own accidental damage insurance policy to replace the damaged item.
What happens if there are multiple tenants?
As with a cash deposit, all tenants are jointly and severally liable to treat the property with due care and pay the rent on time. That means if one tenant doesn’t pay, the other tenants assume total liability for the entire amount due. A NDO must be taken out by all of the tenants i.e. it is not possible to mix a cash deposit and NDO within the same tenancy.
What happens in the event of an early surrender of the tenancy?
If the Landlord agrees to an early surrender the balance of the NDO charge will become due immediately from the tenant.
What happens if there’s a change of sharers?
Chard will complete a surrender of the original tenancy and add the new tenant to a new agreement – the new tenant will then be party to the NDO. We will charge the incoming tenant £48 for the administration of this change. However, please note that outgoing tenants will be charged for surrendering the tenancy and remain liable for the rent until a replacement tenant, who meets our referencing criteria, is found.
Do you reward good tenants?
As we provide rent payment data to the Experian Rental Exchange, tenants who pay their rent on time have the opportunity to strengthen their personal credit rating. Any failure to meet their rental obligations will impact all tenants equally irrespective of which tenant may have failed to pay. It is a tenant’s responsibility to make sure that all rent payments are made in full and on time.
What happens at the end of the tenancy?
As is currently the case with a cash deposit, Landlords have the opportunity to request reimbursement of costs incurred should they believe that their tenants have not met their obligations to maintain the property in line with the tenancy agreement or have failed to pay their rent in full.
In order to qualify for our NDO, a professional check-in and check-out will be required and any charge for damage made by a Landlord will be based on these documents. All of these documents would form the basis of any independent adjudication should that be necessary.
What happens when a Landlord or letting agent requests reimbursement of costs incurred?
If the tenants agree with the request an invoice will be raised and will become payable by the tenant immediately. If they don’t agree, they can suggest an alternative settlement amount. If the Landlord is not willing to accept the tenant’s offer and no resolution is possible then the dispute will be referred for independent adjudication and both parties are legally bound to abide by the outcome of that adjudication.
What happens in the case of disputes?
In the case of a disagreement between Landlord and tenant, an independent government- authorised dispute resolution provider will decide on the case. To start the adjudication process the tenant will be asked to pay £150. If the adjudicator agrees with any part of the tenant’s dispute the adjudication fee will be refunded in full. However should the adjudicator agree that all of the Landlords charge is payable by the tenant then they may be liable to a further charge of up to £150.
What happens at the end of the tenancy if the adjudicator upholds the Landlord’s claim?
Chard would approach the tenant to settle any outstanding amounts. If the tenant doesn’t pay, Chard will pay the Landlord. The tenant will be contacted to repay any monies owed.
What happens if the tenant still doesn’t pay?
If the tenant refuses to pay, the file may be passed to a debt collection agency. If this is required, a tenant may also be liable for any costs incurred in engaging the debt collection agency.
Does a Landlord have to offer a No Deposit Option?
No, Landlords can decide if they are happy to accept a NDO tenancy or not. If not, and the tenant would still like to rent the property, then they would need to provide a cash deposit.
Can a Landlord insist upon a NDO?
No, this has to be an option requested by the tenant and cannot be a condition of the offer.
Do tenants get the NDO fee back at the end of the tenancy if there are no issues?
Is the NDO an insurance policy that will cover the cost of any damage or pay any outstanding rent at the end of the tenancy?
The NDO is NOT an insurance policy and therefore tenants remain liable for the cost of any damage or unpaid rent as per the tenancy agreement.
Does the cost of the NDO go towards any charge made by the Landlord at the end of the tenancy?
No. The cost of the NDO simply removes the need to pay a 5 week deposit at the start of the tenancy. Any monies owed at the end of the tenancy are over and above the cost of the NDO.
(All prices include VAT unless stated).