Depositless or alternative deposit – what are the benefits to renters and landlords?

A number of new products have come onto the market in recent years, designed to support renters to move from one home to another without the need to juggle two deposits. The issue of deposits overlapping is as old as the concept of deposits. It’s a major bugbear for renters and can be a spanner in the works for landlords and agents looking for a smooth rental process. So how do these new products help?

UK rental guarantor service Housing Hand has recently launched its Depositless renting service, which is now available as part of the company’s guarantor service. With Depositless renting, the tenant pays an initial fee of just £25, with the remainder of payments spread across the duration of the tenancy. The service supports them to secure the rental accommodation they desire, with minimal fuss.

With Housing Hand also serving as a guarantor, it’s not just tenants who benefit. Private sector landlords, Build to Rent providers and purpose-build student accommodation providers can all benefit from knowing that any defaults on rent won’t end up costing them. Housing Hand maintains a 100% payout rate for all valid claims.

There are some notable differences between this new Depositless service and the alternative deposit services already on the market. Depositless’ upfront fee and monthly subscription model is one – alternative deposit schemes usually require a single upfront payment.

Fees differ significantly too. Housing Hand’s Depositless fee costs the renter 20% of their monthly rent, with no minimum amount. Alternative deposits tend to cost around 15% more than this.

There’s also the fact that alternative deposits require tenants to pass referencing, which can introduce delays and disappointments on all side of the rental process. Housing Hand’s Depositless service doesn’t require this.

“We’ve looked at the issue of deposits from the perspective of renters, landlords and letting agents, and devised a solution that suits all parties – something that current alternative deposits don’t sufficiently do. The result is a faster, smoother rental process with all those involved feeling more confident and supported.”

James Maguire, Head of Sales and Business Development, Housing Hand

In combination with Housing Hand’s guarantee, its Depositless service covers all liabilities under the tenancy agreement, while other products typically limit cover to the equivalent of six to ten weeks’ rent. Again, this provides reassurance for landlords as well as for tenants. There are also no complicated additional terms or independent adjudication fees required for the Depositless service (whereas there are for alternative deposits), with claims paid out during the tenancy rather than the landlord having to wait until it ends.