Before the Landlord Accepts the Application
When a tenant indicates they wish to place a holding deposit with a landlord, we let the landlord know immediately.
The property's advertising is not suspended until the landlord accepts the holding deposit.
The landlord has 96 hours to accept or reject the holding deposit - if they take no action, we automatically refund the holding deposit.
If the Landlord Accepts the Application
If the landlord accepts the application, the holding deposit will be protected in OpenRent's client funds account while the tenancy is set up. Once the contracts have been signed, the holding deposit will be put towards the first month's rent payment. In other words, the tenant will need to pay the first month's rent, less the holding deposit. The tenant will see a full breakdown of what they need to pay after all parties have signed the contract and they are required to make the final payment.
If the Landlord Rejects the Application
In most cases, if the landlord makes a decision not to continue with the application then the holding deposit will be returned, in full, to the tenant(s). You can see more about refunds here. However, there are some cases in which a landlord might want to cancel the application and claim the holding deposit.
For example, if the landlord has evidence that the tenant(s) have provided false or misleading information or if they have evidence that the tenant(s) do not have the right to rent in the UK (this only applies in England). Landlords may also be able to claim a holding deposit if they have evidence that the tenant(s) have stopped cooperating with the application or have acted unreasonably.
If the Tenants Pull out of the Application
If the tenant(s) decide that they no longer want to rent the property then the landlord may have grounds to claim it under the Tenant Fees Act 2019.
Placing a holding deposit is meant to show that a tenant is serious about renting the property in question, so tenants must make sure only to place one if they definitely want to rent the property! If they pull out after placing it, or if an unreasonable amount of time has passed with no tenant contact, the money will go to the landlord to cover the costs they face by taking their property off the market in order to pursue the application.
You can read more about the Tenant Fees Act 2019 and the rules regarding how holding deposits must be treated here.