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Since 6th April 2007, deposits MUST be submitted to or be insured with, an approved body. If the tenant initially moved in before 6th April 2007 and has signed a NEW tenancy agreement AFTER 6th April 2007, this must be dealt with as above.

If you have not complied with the legislation you cannot use a Section 21 Notice. Additionally, the courts can award the tenant THREE TIMES THE AMOUNT OF THE DEPOSIT, PAYABLE BY THE LANDLORD TO THE TENANT!!!!

UPDATE April 2102 – New legislation meant to tighten up the compliance with deposit protection legislation now means that if you have not protected a deposit on existing tenancies before 6th May 2012, the only way to the serve a SECTION 21 NOTICE is to refund the deposit to the tenant first. If you do this, make sure you can prove you have refunded it them.

You now have 30 days to protect a deposit (previously it was 14 days) but if you do not do so, you can never recover the ability to serve a SECTION 21 NOTICE other than by refunding the deposit as explained above.

FURTHER UPDATE November 3013 – Following a new court decision, the accepted practice that has been followed for nearly 30 years was thrown out of the window. Rather than a Section 21 Notice served in a periodic tenancy having to end on an anniversary of the tenancy, the court now say this can end at any date as long as a minimum of two months NOTICE is given.