As bucket loads of letting agents are continuing to crash and burn at the mercy of the turbulent economic climate, left in-front of the closed door remains a trial disgruntled landlords that have been left out of pocket as agents are sinking before settling their final payments and/or returning tenancy security deposits. Unfortunately, the queue of disgruntles doesn’t seem to be getting any shorter.
In many cases, letting agents will collect rent from tenants on behalf of landlords and have the money deposited in their own company account, and then pass on the agreed amounts to the landlords. That’s how it typically works anyways. But as the letting agents close down, they’re still able to seamlessly collect rent from the tenants, but fail to make the final few payments to the landlords. Convenient that, innit?
It’s been a growing a problem, and I’ve seen this incident being reported regularly. That is exactly why a new mark/badge called “Safe Agent” has been introduced. The mark/badge makes it easy for tenants and landlords to identify agents who are in a Client Money Protection insurance scheme. The mark/badge exists to encourage landlords/tenants to only use letting agents that are part of a scheme. Look out for the Safe Agent mark/badge when dealing with a letting agent…
What is “Safe Agent”?
Coming at you straight from the Safe Agent website…
SAFE – Safe Agent Fully Endorsed – is a mark denoting firms that protect landlords and tenants money through client money protection schemes.
There are several schemes* in the sector operated by ARLA/NFOPP, the Law Society, NALS and RICS to which agents voluntarily belong. The scope of these schemes varies and you should contact your agent for full details of the scheme of which they are a part.
Landlords and tenants often make decisions based on cost but it is important to ensure you ask your agent for details of the organisation they are regulated by and whether or not they are covered by a client money protection scheme. All agents regulated by ARLA/NFOPP, the Law Society, NALS and RICS maintain and operate separate designated client accounts where your money is held completely separate from the operating funds of the firm. If the agent you are using cannot provide you with the assurance of knowing they are covered by a client money protection scheme the question you need to ask is why not?
So basically, ARLA/NFOPP, the Law Society, NALS and RICS, are all Letting agent regulatory bodies. If an agent has voluntarily joined one of those bodies (they have NO reason not to), then they are covered by a Client Money Protection insurance schemes. Each scheme varies and you should always ask your agent for full details of the scheme of which they are part of. But the important thing is that landlords ensure that they only use letting agents that are part of a Client Money Protection insurance scheme, especially if they use letting agents that is going to handle/control any money.
Finding letting agents that are registered with Safe Agent
You can search for letting agents that have registered with Safe Agent on the Safe Agent website. But bear in mind, just because an agent hasn’t registered with Safe Agent, it doesn’t mean they’re not part of a client money protection scheme, so it’s always best to ask.
If you’re a letting agent that is part of a client money protection scheme but haven’t registered, you may want to register now.
Further reading on finding good letting agents
- Only Use Letting Agents That Are Members Of Regulatory Bodies
- Guide On Picking The Right Letting Agent
Have you registered?
I know a lot of letting agents read my blog, so I’m just wondering if you have registered? If so, when? And if not, here’s a *kick in the nuts/vagina*, and now proceed to explain why…