Guide to holding deposits

What is a holding deposit?

A holding deposit is a payment to a landlord or letting agent to reserve a property.

You pay it before you sign a tenancy agreement. It is sometimes called a holding fee.

Some landlords or agents ask for a holding deposit while they carry out pre tenancy checks. For example, referencing, affordability or credit checks.

You cannot be charged any other fees for pre tenancy checks.

The landlord or agent can only take 1 holding deposit for the property at a time.

How much is a holding deposit?

A holding deposit cannot be more than 1 week’s rent for the property you want to reserve.

How to calculate a holding deposit

Monthly rent x 12 ÷ 52 = maximum holding deposit

Ask for a refund if you get charged more

The landlord or agent must refund any money you have paid above this legal limit. 

Citizens Advice consumer helpline can help report them to trading standards if they refuse to refund you.

Do you get a holding deposit back?

A holding deposit should be refunded in full if the landlord decides not to rent to you.

Do not pay a holding deposit without viewing the property. Only pay it if you are serious about taking on the tenancy.

The landlord or agent could keep your holding deposit if you:

They cannot keep your money for any other reason. 

For example, you should get your holding deposit back if you fail a credit or reference check, as long as you give honest and factual information about your situation.

Find out what to do if your holding deposit is not returned.

Last updated: 8 July 2022

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