We know how stressful moving home can be and this is certainly the case currently given the lack of available property to choose from. The last thing you need is unexpected issues delaying your move in, especially if you are moving to a new city or a new country.
The most common reason for delays is due to the payment of initial ‘move-in monies’, especially when money is being sent from overseas.
Firstly, you need to ensure you are dealing with an agent that is complying with the law.
Legislation in the Lettings industry has changed over recent years meaning the agent or the Landlord must act in accordance with this legislation to safeguard your money, specifically your security deposit.
Before you transfer any monies to an agent or a Landlord, ensure they are registered for Client Money Protection. You can find out more here.
Here we explain everything you need to know to help make sure you are prepared, and the process is as smooth as possible.
What to Consider
Things to consider when organising your funds.
- The amount of money to be sent to the Agent/Landlord
- The timescale for the funds to arrive
- The currency exchange rate
- Who is making the transfer?
- Proof of payment
- The full amount due will need to be paid prior to the Tenancy starting.
How Much Do I Need to Pay?
You will need to have funds available to pay the agent/Landlord once you have found the property and passed the reference checks.
If you are entering into an Assured Shorthold Tenancy (AST) with an annual rent of below £50,000 per annum, you will need to pay:
- Security Deposit equivalent to 5 weeks rent (6 weeks if the rent is above £50,000 per annum)
- 1 months’ rent in advance
(If you are studying in the UK, or are not earning in the UK, and do not have a UK based guarantor, you may be required to pay rent in advance. This is usually 6 or 12 months’ rent)
How Long will the Transfer Take?
You need to be aware of how long the transfer will take to arrive with the agent/Landlord.
If you live in the UK, the funds should clear on the same day the transfer is made.
If you are overseas, the transfer can take up to 7 days to clear, sometimes longer.
Some countries also have a credit limit on transfers, and you may need to make multiple transfers. It is best to check with your bank.
Exchange Rate
Before the transfer is made, double check the currency exchange rate. You need to ensure the amount is sent in pounds and the correct amount of money clears with the agent/Landlord or you will delay the start of the Tenancy.
Who is Making the Transfer?
If the transfer is being made on your behalf by a person who is not named on the Tenancy Agreement, this is known as a ‘third party payment’, and you need to make the Agent/Landlord aware.
If any of the funds transferred by the ‘third party’ form part of the security deposit, the person making the transfer will then have an interest in the deposit and will need to be named, along with their contact details in the Tenancy agreement and on the Prescribed Information Form which will be issued to you prior to the Tenancy starting.
If you don’t inform the Agent/Landlord about the ‘third party payment’ in advance, the Tenancy Agreement may need to be re-drafted and you may incur a charge as well as a delay to your move in.
Proof of Payment
Once payment has been made, send the Agent/Landlord a copy of the receipt of payment. This will help them to locate your payment quicker and confirm receipt to you.
Knowing this information and having these details readily available when you find your next home will make a significant difference and allow the process to move smoothly and efficiently and reduce that little bit of extra stress.
Remember to also do your research and ensure you are working with a reputable agent/Landlord to ensure your money and details are being dealt with correctly.
By following these tips and doing your research, you can reduce stress and feel more confident in the renting process. If you would like more information, visit the Insight & Opinion page of our website.
