A new alternative to Rental Deposit
Posted on March 1, 2017 by Joseph Walton
Both Walton & Allen’s Landlords and Tenants could benefit from a new and credible alternative to receiving and paying rental deposits, respectively. The new scheme no longer requires tenants to pay a large deposit, but a much smaller monthly insurance premium. Backed by an insurer listed on the London Stock Exchange, the tenant pays the policy premium for the benefit of the Landlord.
The Tenant is referenced checked and given a ‘policy coverage’ amount, based on the referencing results. So, a tenant with a coverage amount of £2,000 will allow his/her Landlord to claim up to that amount for rent arrears and damage. This is significantly more than existing registered deposits of around £600-£700, in Nottingham
So what are the advantages for both Landlords and Tenants?
Advantages for Landlords
- Landlord is covered to a greater value than the traditional deposit amount
- Premium is paid by the Tenant
- Tenant’s credit rating at risk if premiums or rent is not paid
- Tenant’s credit rating at risk if property is not looked after
- Easy online claims process
- Reduced risk to income stream
Advantages for Tenants
- No upfront deposit to find. Replaced by low monthly premiums
- Increase your credit score, if you pay your rent, bills and premium on time
- Increase your credit score if you look after the property
In terms of costs to the tenant, a typical example would be:
Traditional Tenant Deposit: £700
Insurance Policy Coverage Amount: £1,500
Tenants Premium: £12.50 per month
(These figures are approximated and depend on the tenant’s circumstances)
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