For
Landlords and Tenants peace of mind Wilson Tominey already hold client monies in a separate Client Account and additionally as a member of CM Protect we have Client Money Protection for Landlords and Tenants, however this isn’t the case for all agents, in recent news ARLA the Association of Residential Letting Agents has given its support for what appears to be a government U-turn on Client Money Protection.
Recently the housing minister, Brandon Lewis, appeared to rule out mandatory Client Money Protection on the grounds that it was too heavy-handed and imposed additional red tape on agents.
However, an amendment to the Housing and Planning Bill moved by Lord Palmer and Baroness Hayter has been approved in the Lords, banning letting agents from taking money from tenants unless they hold a separate client money account.
Although it falls short of legal compulsion, Baroness Hayter told the Lords that her amendment “would require every letting agent to have the money they hold be protected so even if the letting agent disappeared or went bankrupt the money would be safe. Such money does not belong to the agent, and as with solicitors who handle client money, it should be held in a separate account.”
David Cox, ARLA managing director, says this is positive news for consumers.
“This new measure means that when government reviews its property transparency measures later this year, there is a real chance that Client Money Protection could finally become mandatory for all property agents in the UK. Consumers may finally have a guarantee that their money is safe and we will continue to work to make this a reality”
We would recommend that both landlords and agents check the agent they are dealing with holds their monies in a protected account for their own peace of mind. We recently read another agents webpage saying that monies come in and go out the same day so they didn’t feel the need for Client Money Protection, we were amazed by this, as it is not unusual for tenants to pay their moving in balance ahead of time and therefore funds can be there for several days before being sent to the landlord and Deposit Protection Service, what would happen if that agent stopped trading before funds were distributed?
