MPs on the housing select committee have today (Thursday) released their report into the Tenant Fees Bill in which they say a clause that allows landlords to charge “default fees” is open to abuse.
Renters could be required to pay these fees if they default on part of their tenancy agreement, by paying their rent late or breaching a condition in their contract.
Citizens Advice is concerned this could be exploited as fees the Government is seeking to abolish, such as inventory checks or exit fees, will simply be written into tenancy contracts and reframed as breaches of the agreement.
Gillian Guy, Chief Executive of Citizens Advice, said:
“The Government’s pledge to ban fees paid by renters is absolutely right. Yet this goal risks being fundamentally undermined by a loophole that could be used by unscrupulous landlords and agents to charge tenants fees through the backdoor. The committee recognises that default fees are open to abuse, but their solutions do not go far enough. Each month renters are paying more than £13 million in unfair and unaffordable fees, which would mean a total of more than £200 million since a ban was first announced in November 2016. The Government must act quickly and commit to removing this default fees clause, creating a Bill that will achieve its aim of a fairer and more affordable lettings market.”