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Forums > Active > The Netrent Forum
Subject: Investment bank pay deposit for tenant

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Author Messages
Janine
Posts:3
17 Oct 2006 13:46:54 Alert 
Hello,
I would appreciate it if some-one could advise me please. I have a prospective tenant who has passed referencing with a referencing agency I use. However, the tenant's employer, an investment bank are to pay me the security deposit and the month in advance directly to my account and then set up the Standing Order and pay the rent monthly to me directly.

I have noticed that from their letter of intention to do this they state 'that it it not a guarantee by the Bank of the obligations of the Tenant set out in the tenancy Agreement. In particular the Bank does not guarantee the obligations of the Tenant to pay rent under the Tenancy Agreement'.

I have informed the tenant that the deposit must be part of the agreement as it will not hold up as a security deposit if it is the Banks money and they are not obligated to the AST agreement. I am not sure about this and the rental payments, which I will have to leave to the bank to set up (I usually organize this myself) but the Bank will not give out their bank details! The main issue to me is the security deposit; has some-one has this before and can let me know of the situation.

Kind regards,
janine.
adamlaver
Posts:2
19 Oct 2006 15:09:22 Alert 
It doesn't matter who actually pays the bond or rent - the name and signatory on the tenancy agreement is the important part. Assuming the tenancy is in the name of the tenant then that is the person wholly responsible for the tenancy/rent and who will be legally entitled to the deposit when vacating the property. The fact that her company are paying her bond and rent is irrelavant. If you want the rent to be guaranteed by the company then they should either be named on the tenancy or legally commit to standing as guarantors.

I suspect the bank is just covering itself in case she looses her job or breaches her tenancy agreement. They won't want to be responsible for the tenancy if she defaults.

Obviously if a separate codicile or appendix to the agreement agrees to any specific arrangements concerning the bond then this would have to be adhered to. This would however be very unusual and obviuosly make the very purpose of a bond worthless.

I hope this helps.
Janine
Posts:3
24 Oct 2006 05:16:34 Alert 
Hello Adam,

Thank-you very much for anwering my question, I intially thought the bank had expected me to pay back the deposit to them at the end of the tenancy! Now it has been clarified that it should be paid back to the tenant and everything is set to go ahead :).

Many thanks to you,
Janine.
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Forums > Active > The Netrent Forum > Investment bank pay deposit for tenant


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